Product Market Competition and Economic Performance in the Netherlands

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Product Market Competition and Economic Performance in the Netherlands

Author Info

Maria Maher
Michael Wise

Abstract

This paper assesses what role product market competition and reforms may have played in the performance of the Dutch economy over the past decade, and discusses what further product market reforms might contribute to enhancing growth. In general, competitive pressures appear to be relatively strong in the Netherlands, particularly in the traded goods sector. Competition in product markets has been strengthened through the creation of a competition authority (NMa) and the Competition, Deregulation and Legislative Quality project (MDW). A planned reduction in the administrative burden will also help to strengthen competition, by reducing barriers to business start-ups and the expansion of small businesses, as well as lowering business costs. However, competitive pressures and productivity growth are weaker in the Dutch services sector. Planning restrictions are inhibiting competition and productivity growth in the retail sector and there is considerable scope to eliminate practices that restrict competition in professional services, even though both are relatively liberalised in the Netherlands. Reforms in electricity, gas and telecoms are recent and market power on the part of incumbent firms remains a concern. Competitive pressures in these industries could be increased by enhancing the powers of the regulators and eliminating barriers to entry.

Concurrence sur les marchés de produits et performance économique aux Pays-Bas
Ce document évalue le rôle que la concurrence sur les marchés de produits et les réformes ont pu jouer dans les performances de l’économie néerlandaise cette dernière décennie et débat sur l’action qui pourrait être menée pour améliorer la croissance. D’une façon générale, les pressions concurrentielles paraissent relativement fortes aux Pays-Bas en particulier dans les secteurs des biens échangés. La concurrence sur les marchés de produits a été renforcée grâce à la mise en place d’une autorité de la concurrence (la NMa) et au projet « Concurrence, déréglementation et qualité de la réglementation » (MDW). L’allégement prévu des charges administratives contribuera également à renforcer la concurrence en réduisant les obstacles à la création d’entreprises et à l’expansion des petites entreprises, tout en diminuant les coûts des activités industrielles ou commerciales. Toutefois, la concurrence et la productivité du travail sont plus faibles dans le secteur des services. Les règles d’urbanisme entravent la concurrence et la croissance de la productivité dans le commerce de détail et de vastes possibilités s’offrent d’éliminer les pratiques qui restreignent la concurrence dans les services professionnels, même si ces activités sont relativement libéralisées aux Pays- Bas. Les réformes dans les secteurs de l’électricité, du gaz et des télécommunications sont récentes et le pouvoir de marché des opérateurs historiques demeure problématique. La concurrence dans ces secteurs pourrait être intensifier, en augmentant les prérogatives des autorités de régulation et en éliminant les barrières à l’entrée.

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Paper provided by OECD, Economics Department in its series OECD Economics Department Working Papers with number 422.

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Date of creation: 31 Mar 2005
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Handle: RePEc:oec:ecoaaa:422-en

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Find related papers by JEL classification:
K21 - Law and Economics - - Regulation and Business Law - - - Antitrust Law
K23 - Law and Economics - - Regulation and Business Law - - - Regulated Industries and Administrative Law
L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
L40 - Industrial Organization - - Antitrust Issues and Policies - - - General
L43 - Industrial Organization - - Antitrust Issues and Policies - - - Legal Monopolies and Regulation or Deregulation
O51 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - U.S.; Canada

This paper has been announced in the following NEP Reports:

NEP-ALL-2005-10-15 (All new papers)
NEP-COM-2005-10-15 (Industrial Competition)
NEP-EEC-2005-10-15 (European Economics)

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