Papers and Publications on Competition Law & Policy in Developing Countries
Research is underway on the following papers, which examine the causes and consequences of competition law and policy in developing countries:
Tim Büthe and Sophia Staal.  "From Rule-Taker to Rule-Maker?  The Transformation of Kenya's Competition Policy."  Manuscript for a journal article (work in progress), Duke University, January 2015.
This paper analyzes the remarkable (and ongoing) transformation of the Kenyan competition policy regime since the initial adoption of the Restrictive Trade Practices, Monopolies, and Price Control Act of 1989.  Kenya, a regional middle power in Eastern sub-Saharan Africa, was one of the first of the many developing countries that have over the past two and a half decades put a competition law on the books.  The 1989 Act, however, was poorly designed, lacking clarification of its relationship to existing (and often conflicting) political, economic, or legal institutions.  It also was poorly and inconsistently enforced, and widely seen as (at best) ineffective in safeguarding or increasing the benefits of a market economy for Kenyans.  In 2010, the Kenyan parliament replaced the 1989 Act with the new Competition Act in the context of constitutional reforms that included major judicial reform and the creation of a more independent market regulator, which has earned repeated praise for its implementation and enforcement of the new legislation.  This paper seeks to contribute to a better understanding of the ongoing transformation of the Kenyan competition regime by explaining the recent changes in the Kenyan competition regime.  It emphasizes the importance of domestic politics rather than foreign influence (despite the fact that the 2010 Act is modeled on foreign statutes, specifically EU competition law, to a greater extent than the 1989 law) and the desire to transform Kenya into a regional rule-maker via the Common Market for Eastern and Southern Africa, COMESA, which provided additional leverage to those domestic political actors who favored a stronger competition regime.
See also the companion paper about the economic consequences of the Kenyan competition policy reforms for the competitiveness of several sectors of the Kenyan economy, which have long been plagued by anti-competitive structures and behavior (Staaal and Büthe 2015) among the research on the Political-Economic Effects of Competition Law and Policy.
Rachel Glanz and Tim Büthe.  "Competition Advocacy as an Anti-Rent-Seeking Policy? An Empirical Analysis of Ukraine, 2002-2005."  Paper to be presented at [name of conference withheld pending final confirmation], 2015.
The rapid adoption of competition regimes across the developing world in the last twenty-five years suggests a growing consensus that economic development and prosperity is predicated on competitive interactions among producers.  Much of the early work on how to achieve the full benefits of a competition regime in developing countries focused on the specificity and breadth of the prohibitions of anti-competitive behavior in the competition laws, the strength of the enforcement of such prohibitions, and whether or not competition laws in developing countries should include merger regulation.  Recent work, by contrast, has increasingly emphasized the importance of a broader competition policy, and in particular the need for competition advocacy, defined by the International Competition Network (ICN) in 2002 as the "promotion of a competitive environment for economic activities by means of non-enforcement mechanisms, mainly through [a competition agency's] relationship with other governmental entities and by increasing public awareness [of] the benefits of competition."  A key objective of such an advocacy role is to establish within the government a vocal promoter of competition principles, so as to reduce the risk of anti-competitive laws or regulations getting adopted, based on proposals from ministries or agencies with particularistic agendas, often under the influence of powerful rent-seeking private actors.  While these benefits of competition advocacy in developing countries have been widely proclaimed, there has been little systematic empirical scrutiny of such claims.  In this brief paper, we directly analyze competition advocacy as an anti-rent-seeking policy by taking advantage of the availability of exceptional good data on rent-seeking lobbying in Ukraine before and after the 2003 revision of the competition law, which greatly enhanced its Antimonopoly Committee (AMC)'s advocacy powers by making advance review and clearance of laws and regulations by the AMC mandatory.  We find that this greater advocacy role indeed resulted in a substantial, statistically highly significant decline in the level of rent-seeking.
See also the companion paper about competition advocacy more generally (Büthe and Glanz 2015) among the research on the Political-Economic Effects of Competition Law and Policy.
Umut Aydin and Tim Büthe.  "Success and Limits of Competition Law & Policy in Developing Countries:  Explaining Variations in Outcomes; Exploring Possibilities and Limits."  Paper presented at Kenan/Rethinking Regulation Workshop, Duke University, 4 May 2015.
Are competitive markets a privilege of rich, industrial democracies?  Competitive markets ensure that the tremendous potential benefits of a market economy—such as product variety, innovation leading to new products, increasing quality, and/or lower price for the same goods, and economic growth or development—are both achieved and widely shared.  So there is much at stake in understanding the conditions under which markets can become and remain competitive and under which laws and policies that seek to foster competitive markets will succeed.  More than one hundred and thirty countries or jurisdictions now have laws that seeks to create and support competitive markets.  More than two thirds of the now one 130+ jurisdictions with competition laws have enacted such a law for the first time only in the last twenty-five years.  Most of them are developing countries, which have done so under conditions that are hardly conducive to the successful implementation of such pro-market legislation, as pointed out in the incisive study by Rodriguez and Menon (2010).  The serious challenges for competition law and policy, which arise from these conditions in developing countries, have been further examined in recent scholarship by Gal, Fox, Bakhoum, Drexl, and Gerber (2015) as well as Sokol, Cheng and Lianos (2013).  Some young competition agencies in the developing world, however, appear to have overcome these challenges and—based on their often short record so far—seem to have succeeded in becoming politically highly independent, building substantial analytical capacity, and in some cases becoming highly effective in dismantling private and public barriers to competition in their countries, contributing to development and other goals of these societies.  It is the variation in trajectories after the first adoption of a competition law that we seek to understand, focusing on the questions: (1) Why has the establishment of a competition law and regulatory agency succeeded in some countries while it largely failed in others?  (2) What are the conditions, including possibly the characteristics of the laws and/or the regulatory agencies, under which competition law and policy will contribute to development, equality and economic and/or political liberalization?








< page last updated 9 September 2015 >