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An empirical assessment of the relationship between competition policy and investment

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  • Sudsawasd, Sasatra

Abstract

The relationship between competition policy and investment is empirically examined. Empirical findings suggest that increasing market competition has a positive and robust impact on the share of total investment in GDP per capita. Developing countries enjoy benefits from competition legislation efficiency improvement, whereas the reduction of government anti-competitive price control intervention enhances the good investment environment in developed countries. In relation to the potential impacts of ASEAN competition policies, if ASEAN-4 countries (Indonesia, Malaysia, Philippines, and Thailand) become as competitive as Singapore, the investment shares are expected to increase to approximately 2-4%. Further, foreign direct investment inflows from the 30 OECD countries are expected to increase roughly 0.6-1.2%.

Suggested Citation

  • Sudsawasd, Sasatra, 2010. "An empirical assessment of the relationship between competition policy and investment," Journal of Asian Economics, Elsevier, vol. 21(5), pages 466-475, October.
    • Handle: RePEc:eee:asieco:v:21:y:2010:i:5:p:466-475
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