Competition and Consumer Policies: Starting Points for Better Convergence

Abstract:     
Competition and consumer policies have developed in many jurisdictions along separate lines. The potential complementarities and tensions between these two areas have often been overlooked. However, the way markets evolve today and the kind of market failures consumers and companies face call for new regulatory approaches that have a firm basis in both competition and consumer policies. When markets fail to work effectively we turn to competition and consumer protection. However, the specific form and the tools of intervention depend on the nature of the market failures. Different market failures trigger different remedies and the remedies exhibit different “spill-over effects”. The regulatory choices need to account for the specific functions competition and consumer policies have. This paper addresses the interface between competition and consumer policies by discussing a number of specific issues that are situated at the crossroads of these two fields. These issues include the interpretation of the consumer welfare standard in both policy areas, the role of consumers in the pro-competitive reforms as well as an overview of the close parallels in the new enforcement methods that are presently discussed and proposed in both fields. Better convergence of competition and consumer policies is vital, but the discussion on how to achieve closer cooperation on national and international platforms is underdeveloped. Moreover, policy calls for better coordination and integration between these two policies need to take account of the costs and not only the benefits of such integration in both substantive law and in the law enforcement. The convergence and divergence between competition and consumer policies and law enforcement is worth exploring - and this paper intends to provide starting points for further research.

Number of Pages in PDF File: 45

Keywords: Antitrust law, Consumer Protection, Economics of Regulation, Enforcement of Law

JEL Classification: JEL: D18, L51, L40, K42

working papers series