Articles

COMPETITION FOR THE MARKET AND LIBERALIZATION: THE FRENCH EXPERIENCE


Abstract


Progressing from a state controlled economy to a fully liberalized market economy takes considerable efforts. Depending on the specificities of the markets and the sectors regulated, the opening of markets to competition can take different forms. Competition on the market is considered to be the traditional form of competition. Certain economic sectors, however, are not prone to this traditional form of competition, specifically in situations where natural monopolies seem to be the only viable solutions. This is where competition for the market can be a good substitute.
Competition for the market implies that a bidding process is organized to select the operator, which will be allowed to serve demand on a given market for a given time. Going through this bidding process is meant to introduce market mechanisms or, in other words, ex ante competition. As such, competition for the market contributes to put competitive pressure on monopolists, which is beneficial to consumers and users not only in terms of price and service quality, but also in terms of adjustment between supply and demand and access to information.
Experience has shown, however, that several factors can hinder the expected benefits derived from competition for the market. In light of these difficulties, the French Competition Authority de la concurrence has developed solutions to unleash the full potential of competition for the market.
Naturally, once markets are liberalized, comes the time for regulation through enforcement actions as well as continued advocacy efforts toward government, incumbent operators and new market players.


Keywords


Liberalization; Competition for the market; Bidding; Public service; Regulation

Full Text:

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NBN: http://nbn.depositolegale.it/urn%3Anbn%3Ait%3Aagcm-15189

DOI: http://dx.doi.org/10.12870/iar-11054

References






Rivista Italiana Antitrust / Italian Antitrust Review
ISSN: 2284-3272

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