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

CCLP(L)55 Working Paper, 2021

29 Pages Posted: 2 Jul 2021

See all articles by Ariel Ezrachi

Ariel Ezrachi

University of Oxford - Faculty of Law

Amit Zac

University of Oxford

Christopher Decker

University of Oxford

Carola Casti

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 and Casti, Carola, The Effects of Competition Law on Inequality – Incidental By-Product or a Path for Societal Change? (June 19, 2021). CCLP(L)55 Working Paper, 2021, 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)

University of Oxford ( email )

St Cross Building
St Cross Rd
Oxford
United Kingdom

Christopher Decker

University of Oxford ( email )

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

Carola Casti

University of Oxford ( email )

Mansfield Road
Oxford, Oxfordshire OX1 4AU
United Kingdom

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