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The Real Economy and Competition Policy in Periods of Retrenchment

Author

Listed:
  • Gheorghe Oprescu

    () (Institute for Business Administration, Polytechnic University of Bucharest, Romania)

  • Daniela Eleodor

    (Academy of Economic Studies, Bucharest, Romania)

  • Russell Damtoft

Abstract

Competition policy works well when markets are given time to evolve and drive improved efficiency; but this takes time. However, under current turbulent times, the short-run survival actions may be insistently sought by policy-makers under the pressure of trade unions and the exit of failing firms may be perceived to be more costly for society. Actually, the immediate costs that existing businesses, employees and consumers have to incur may be up-front and visible, while the benefits of competition may be less visible. As a consequence, times of severe financial and economic crises bring about a severe questioning of market mechanisms with unfailing regularity and the stance of the competition policy against this backdrop. We shall therefore look in the current paper at the role of competition authorities in a time of severe economic and financial crisis and in particular, at how the crisis will impact the application of competition law. In the end, we will conclude in favour of the need to preserve competition policy as well in difficult times even if we admit that a certain flexibilisation in procedures (but not in rules) may be probably necessary.

Suggested Citation

  • Gheorghe Oprescu & Daniela Eleodor & Russell Damtoft, 2009. "The Real Economy and Competition Policy in Periods of Retrenchment," The AMFITEATRU ECONOMIC journal, Academy of Economic Studies - Bucharest, Romania, vol. 11(Number Sp), pages 722-734, November.
  • Handle: RePEc:aes:amfeco:v:11:y:2009:i:number_special_3:p:722-734
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    File URL: http://www.amfiteatrueconomic.ro/temp/Article_912.pdf
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    References listed on IDEAS

    as
    1. Xavier Vives, 2011. "Competition policy in banking," Oxford Review of Economic Policy, Oxford University Press, vol. 27(3), pages 479-497.
    2. Sandro Brusco & Fabio Castiglionesi, 2007. "Liquidity Coinsurance, Moral Hazard, and Financial Contagion," Journal of Finance, American Finance Association, vol. 62(5), pages 2275-2302, October.
    3. Bittlingmayer, George, 1993. "The Stock Market and Early Antitrust Enforcement," Journal of Law and Economics, University of Chicago Press, vol. 36(1), pages 1-32, April.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Nicolae Dardac & Petronel Chiriac & Bogdan Moinescu, 2012. "The Use of Internal Rating Models in Managing the Risks Related to the Exposures of Non-banking Financial Institutions," The AMFITEATRU ECONOMIC journal, Academy of Economic Studies - Bucharest, Romania, vol. 14(31), pages 258-271, February.

    More about this item

    Keywords

    retrenchment; antitrust and merger control; state aid policy; competition authority;

    JEL classification:

    • L4 - Industrial Organization - - Antitrust Issues and Policies
    • L5 - Industrial Organization - - Regulation and Industrial Policy

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