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Product Market Competition and Economic Performance in Canada

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  • Maria Maher
  • Jay Shaffer
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    Abstract

    This paper examines the strength of product market competition and economic performance in Canada and discusses way in which the institutional framework governing competition policy could be improved. Competitive forces are comparatively strong and administrative and economic regulations inhibiting competition are amongst the lowest in the OECD countries. However, Canada’s regulated conduct doctrine exempts anti-competitive behaviour when required by regulation, and thus significant parts of the economy remain shielded from the competition law. This is a particular problem with provincial government regulation. Restrictions on internal trade also continue to exist, and implementation of the Agreement on Internal Trade is less effective than it could be. More attention needs to be focussed on removing those regulations that restrain competition, particularly in professional services. In network industries, competition has largely been absent in the electricity sector. While it is widely recognised that reforms are necessary, those undertaken in the past have mainly been aimed at bringing in private-sector investment, while avoiding full competition in generation and in retail markets. Canada has more significant restrictions on foreign ownership than almost any other OECD country, notably in airlines, telecommunications and broadcasting, and their removal could improve performance in these sectors. Concurrence sur les marchés de produits et performance économique au Canada Ce document examine la puissance de la concurrence dans les marchés de produits et de la performance économique au Canada. Il envisage aussi les moyens par lesquels pourrait être amélioré le cadre institutionnel qui gouverne les politiques de la concurrence. La vigueur des forces concurrentielles est comparativement élevée au Canada et les régulations inhibant la concurrence sont parmi les plus faibles de la zone de l’OCDE. Cependant, le code canadien de conduite réglementé exonère les comportements anticoncurrentiels lorsqu’ils sont couverts par une réglementation, de sorte que certains pans importants de l’économie restent non couverts par le droit de la concurrence. Ce problème est particulièrement aigu dans le cas des réglementations sous autorités provinciales. Des restrictions continuent de limiter les échanges provinciaux, et la mise en œuvre de l’Accord sur le commerce intérieur est moins effective qu’elle pourrait l’être. Il conviendrait de chercher plus activement à supprimer les réglementations qui freinent la concurrence dans les professions libérales. Dans les industries de réseaux, la concurrence a été pratiquement absente dans le secteur de l’électricité. S’il existe un large consensus sur la nécessité de réformes, celles qui ont été entreprises par le passé ont eu pour objectif principal d’encourager l’investissement du secteur privé, tout en évitant l’ouverture intégrale à la concurrence de secteurs comme la production d’électricité et la vente au détail. Le Canada connaît aussi un plus grand nombre de restrictions significatives concernant les intérêts étrangers que presque tous les autres pays de l’OCDE, notamment dans les domaines du transport aérien, des télécommunications et de la télédiffusion. Leur élimination pourrait stimuler les performances dans ces secteurs.

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    File URL: http://dx.doi.org/10.1787/553075711023
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    Bibliographic Info

    Paper provided by OECD Publishing in its series OECD Economics Department Working Papers with number 421.

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    Date of creation: 30 Mar 2005
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    Handle: RePEc:oec:ecoaaa:421-en

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    Keywords: market structure; network industries; antitrust law; productivity and growth; regulatory policies; competition; Canada; structure de marché; productivité et croissance; concurrence; politique de réglementation; loi anti-trust; industrie de réseau; Canada;

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    Cited by:
    1. Paul Conway & Giuseppe Nicoletti, 2007. "Product Market Regulation and Productivity Convergence: OECD Evidence and Implications for Canada," International Productivity Monitor, Centre for the Study of Living Standards, vol. 15, pages 3-24, Fall.

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