The Effects of Competition Law on Inequality – Incidental By-Product or a Path for Societal Change?

Journal of Antitrust Enforcement, 2023, 11, 51–73 https://doi.org/10.1093/jaenfo/jnac011

Posted: 2 Jul 2021 Last revised: 30 Jan 2024

See all articles by Ariel Ezrachi

Ariel Ezrachi

University of Oxford - Faculty of Law

Amit Zac

ETH Zürich; University of Amsterdam - University of Amsterdam Faculty of Law

Christopher Decker

University of Oxford

Date Written: June 19, 2021

Abstract

Rising economic inequality presents society with unprecedented challenges. Direct instruments designed to address these worrying trends have often under performed. As a result, we find ourselves on a potentially dangerous and unsustainable path. In this paper we explore whether, in parallel to other efforts to mitigate the rise of inequality, there can be a role for competition law to play in the quest to reduce the widening inequality gap. We begin by outlining the possible relationship between competition law enforcement, market power, and economic inequality. We supplement the theoretical discussion with a review of our empirical analysis of these linkages. We look at macro and micro data and emphasize the role of labor compensation as a key mechanism which links competition law enforcement, competition dynamics and economic inequality. With this in mind, we then reflect on the policy implications and possible means to utilize competition enforcement in a manner that would reduce economic inequality.

Keywords: Competition Policy and Law, Inequality, Labour Share, Empirical Legal Studies

Suggested Citation

Ezrachi, Ariel and Zac, Amit and Decker, Christopher, The Effects of Competition Law on Inequality – Incidental By-Product or a Path for Societal Change? (June 19, 2021). Journal of Antitrust Enforcement, 2023, 11, 51–73 https://doi.org/10.1093/jaenfo/jnac011, Available at SSRN: https://ssrn.com/abstract=3870375 or http://dx.doi.org/10.2139/ssrn.3870375

Ariel Ezrachi

University of Oxford - Faculty of Law ( email )

Oxford
United Kingdom

Amit Zac (Contact Author)

ETH Zürich ( email )

LEE G104
Leonhardstrasse 21
Zurich
Switzerland

HOME PAGE: http://https://lawecon.ethz.ch/group/scientific-team/zac.html

University of Amsterdam - University of Amsterdam Faculty of Law ( email )

Postbus 15654
1001 ND
Amsterdam, Noord-Holland 1001 ND
Netherlands

Christopher Decker

University of Oxford ( email )

Manor Road Building
Manor Road
Oxford, Oxfordshire OX1 3UQ
United Kingdom

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