Competition and economic performance nexus. A theoretical approach

This paper presents a theoretical exploration of the complex relationship between competition and economic performance. Competition has long been recognized as a driving force in economic systems, affecting market dynamics, innovation, efficiency, and consumer welfare. This article aims to contribute to the existing profile literature by developing a novel theoretical framework that scrutinizes the mechanisms through which competition influences economic performance. Drawing from established economic theories and models, a comprehensive model is proposed that encompasses various dimensions of competition, including price competition, non-price competition, market structure and regulatory environment. Key variables, exploring their interplay within a coherent theoretical structure, are carefully defined and operationalized. The present analysis reveals that competition is not a one-size-fits-all concept and that its impact on economic performance depends on specific contextual factors. The role of other determinants of economic performance, such as government policies, technological developments and external shocks, is also analysed so as to provide a holistic view of the intricate economic landscape.