Imports, Entry and Competition Law as Market Disciplines

Bernard Hoekman () and Hiau Looi Kee ()

No 3777, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: Since the early 1990s, numerous countries have adopted or strengthened competition legislation. In this Paper we investigate the impact of competition law on industry markups over time and across a large number of countries. We find both domestic and foreign competition to be major sources of market discipline in concentrated markets, but that the direct effect of competition law is insignificant. Once allowance is made for the endogeneity of both domestic competition (number of firms) and the adoption of a competition law, however, we find that competition laws have an indirect effect on equilibrium markups by promoting a larger number of domestic firms.

Keywords: competition law; domestic entry; import penetration; industry markup (search for similar items in EconPapers)
JEL-codes: F12 F13 L11 (search for similar items in EconPapers)
Date: Written
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Related works:
Working Paper: Imports, entry, and competition law as market disciplines (2003)
Journal Article: Imports, entry and competition law as market disciplines (2007)
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