|To improve the empirical analysis of competition policy not just marginally but categorically, we have launched a multi-pronged empirical research agenda:|
|(1) Competition Laws Around the World, 1889-2010: For every country in the world, we seek to establish when it first adopted a statutory prohibition of anti-competitive practices and when those laws were subsequently changed. We are collecting the texts for each national competition law (including major revisions) and, most importantly, code the specific contents of those laws: What is the stated goal of the law? What is covered by the statute, i.e., which specific competition-restricting practices and actions by a firm with a dominant position in its market does the law cover and prohibit? What is exempted (e.g., export cartels)? Does the law contain a merger notification requirement, and does it authorize prohibiting or restricting anti-competitive mergers? What kind of enforcement is authorized? Etc. This work provides crucial background information for the research on enforcement and international cooperation discussed below. The resulting data will also allow us to test specific hypotheses about the relationship between trade patterns and the adoption and stringency of competition laws to assess broader theoretical arguments about economic openness and competition policy as complements or substitutes as well as more general theories of the diffusion of public policies.
Our coding of competition laws builds on work by Keith Hylton of Boston University School of Law, but addresses substantive problems with his coding and substantially extends the chronological scope of the coded national competition statutes.
|(2) Antitrust Enforcement Around the World: Macro-Analysis: To better assess the effective scope
of competition regulation in countries with competition statutes, we are gathering data on input and output measures of competition law
enforcement. Key input measures are agency budget and staff. Key output measures include the number of cartel, dominance, and
merger investigations opened, the frequency and severity of fines and/or other remedies imposed, and the share of mergers subjected to
in-depth investigation, approved subject to conditions, prohibited, or withdrawn. We are collecting this data for a large panel of
both developed and developing countries since 1990 or since the adoption of a country's first antitrust law. The resulting data will enable us to examine the relationship between trade patterns and aggregate patterns of enforcement, both across countries and, in panel analyses, over time.
The resulting data will need to be interpreted carefully in light of measures of the overall quality of a country's bureaucracy, as well as the level of actual competition in an industry or national economy since, in equilibrium, countries with highly effective enforcement of its competition laws might undertake little or no enforcement actions, if they successfully deter violations.
|(3) Micro Analysis of U.S. Enforcement, 1960-2010: We seek to complement the analyses of cross-national data on enforcement (which is panel data with relatively short time series for each country) with detailed longitudinal analyses of the development of enforcement in the United States, one of the countries with the longest history of national antitrust legislation and enforcement. Specifically, building on Richard Posner's seminal article "A Statistical Study of Antitrust Enforcement" (Journal of Law and Economics 1970), we are coding each antitrust enforcement action undertaken by U.S. Department of Justice, extending the time series through 2010. Very importantly, we are also coding for the nationality of the parties involved and the products or services in question, aspects of U.S. enforcement actions not coded in previous work. This will allow us to link up the data about U.S. antitrust enforcement with data on U.S. exports and imports at the industry level to test distinct hypotheses, derived from prior and novel theoretical arguments, about changes over time in the relationship between economic openness and competition policy.
Under U.S. law, antitrust enforcement is conducted by both the Department of Justice (DoJ) and the Federal Trade Commission (FTC), who divide cases amongst themselves, mostly based on the industry involved. Due to practical constraints (the DoJ alone has undertaken several thousand enforcement actions since 1960), we are currently focusing on DoJ enforcement, only. In subsequent work, we hope to extend the analysis to FTC enforcement actions, too.
|(4) Micro Analyses of other Countries: We are exploring the feasibility of detailed analyses of the enforcement actions or more generally the development of competition policy within other individual countries or jurisdictions, such as the EU.|
|(5) Antitrust/Competition Policy Provisions in Trade Agreements, 1945-2010: To examine our hypothesis that governments will increase and institutionalize international regulatory cooperation in the realm of competition law enforcement in conjunction with increases in the level of trade openness, we are coding in detail the competition provision (if any) in 587 preferential trade agreements (PTAs) signed since 1945. Our coding includes the following aspects: whether the agreement entails an obligation to maintain a separate antitrust enforcement agency, whether it specifies legitimate goals for antitrust enforcement (and if so, which ones: consumer welfare, efficiency, protection of small and medium-sized enterprises, industrial policy goals, etc.), whether the agreement covers only "hard core" cartels or also "vertical" anti-competitive agreements and/or the abuse of dominance; whether there are exemptions for export cartels, state-owned enterprises, or particular industries (and if so, which industries); whether the agreement recognizes an "efficiency defense"; whether the agreement covers mergers; whether it institutionalizes regulatory cooperation and if so, in which form and how extensively; and whether the agreement contains a dispute settlement procedure that applies to the antitrust issues that arise between parties.
This part of our project builds on the work of Baccini, Dür, Elsig, and Milewicz, whom we thank for giving us access to the texts of the PTAs. For an overview of their PTA project, see "The Design of International Trade Agreements: Introducing a New Database." Review of International Organizations vol._ no._ (2014, forthcoming).
|(6) Transgovernmental Enforcement Cooperation and Its Institutionalization via Bilateral or Multilateral Antitrust Cooperation Agreements: Neither de factor international cooperation on antitrust matters nor its institutionalization needs to be necessarily linked to economic openness. We are therefore also assembling a comprehensive list of bilateral and multilateral cooperation agreements that address competition policy issues separately from trade-related obligations (PTAs). We will code these antitrust cooperation agreements for their timing and specific contents, focusing on the same aspects as for the coding of competition provisions in PTAs.|