A Case for Affirmative Action in Competition Policy

Bertrand Villeneuve and Vanessa Zhang ()

MPRA Paper from University Library of Munich, Germany

Abstract: We analyze the trade-off faced by competition authorities envisaging a one-shot structural reform in a capitalistic industry. A structure is (1) a sharing of productive capital at some time and (2) a sharing of sites or any other non-reproducible assets. The latter represent opportunities. These two distinct dimensions of policy illustrate the importance of a dynamic theory in which firms may differ in several respects. Though equalization of endowments and rights is theoretically optimal, realistic constraints force competition authorities to adopt second-best solutions. Affirmative action here appears to explain why helping the disadvantaged contributes maximally to social surplus.

Keywords: Competition policy; capacity accumulation; Cournot competition; asymmetric duopoly; regulatory consistency; differential games (search for similar items in EconPapers)
JEL-codes: C73 L13 L40 (search for similar items in EconPapers)
Date: 2008-07-23
New Economics Papers: this item is included in nep-com, nep-gth, nep-mic and nep-reg
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:9700

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