EconPapers    
Economics at your fingertips  
 

Competition Policy with Optimally Differentiated Rules Instead of "Per se Rules vs. Rule of Reason"

Arndt Christiansen () and Wolfgang Kerber ()
Additional contact information
Arndt Christiansen: Faculty of Business Administration and Economics, Philipps Universitaet Marburg
Wolfgang Kerber: Faculty of Business Administration and Economics, Philipps Universitaet Marburg

Authors registered in the RePEc Author Service: Arndt Christiansen

No 200606, Marburg Working Papers on Economics from Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung)

Abstract: Abstract: Both in US antitrust and EU competition policy a development to a broader appli-cation of rule of reason instead of per se rules can be observed. In the European discussion the attempt to base competition policy on a "more economic approach" is mainly viewed as im-proving the economic analysis in the assessment of specific cases. In this paper it is shown from a general law and economics perspective that the application of rules instead of focus-sing on case-by-case analyses can have many advantages (less regulation costs, rent seeking and knowledge problems), although an additional differentiation of rules through a deeper assessment can also have advantages in regard to the reduction of decision errors of type I and II. After introducing the notion of a continuum of more or less differentiated rules, we show - based upon law and economics literature upon the optimal complexity of rules - in a simple model that a competition rule is optimally differentiated, if the marginal reduction of the sum of error costs (as the marginal benefit of differentiation) equals the marginal costs of differen-tiation. This model also allows for a more detailed analysis of the most important determi-nants of the optimal degree of rule-differentia¬tion. From this law and economics perspective, competition policy should consist mainly of (more or less differentiated) rules and should only rarely rely on case-by-case analysis. Therefore the main task of a "more economic ap-proach" is to use economics for the formulation of appropriate competition rules.

Keywords: Competition Policy; European Competition Law; Rule of Reason (search for similar items in EconPapers)
JEL-codes: K L (search for similar items in EconPapers)
Pages: 26 pages
Date: 2006
New Economics Papers: this item is included in nep-com, nep-eec, nep-law and nep-reg
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (50)

Downloads: (external link)
http://www.uni-marburg.de/fb02/makro/forschung/gel ... istiansen-Kerber.pdf First version, 2006 (application/pdf)

Related works:
Journal Article: COMPETITION POLICY WITH OPTIMALLY DIFFERENTIATED RULES INSTEAD OF “PER SE RULES VS RULE OF REASON” (2006) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:mar:volksw:200606

Access Statistics for this paper

More papers in Marburg Working Papers on Economics from Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung) Contact information at EDIRC.
Bibliographic data for series maintained by Bernd Hayo ().

 
Page updated 2025-03-30
Handle: RePEc:mar:volksw:200606