Guidelines for authors
CUTS Competition, Regulation and Development Research
2nd Research Cycle
The overall aim of the Forum to
which this study is contributing is to explore the various
options available for effective implementation of competition
and regulatory laws in developing countries.
Authors are requested to provide a
paper proposal (2-3 pages) addressing the points outlined below:
An abstract of no more than 500
words with some methodological details.
The name(s) of author(s),
affiliation(s), and email address(es).
The index of the paper-stating
list of proposed sections in the paper.
A detailed account of the likely
substance of the paper:
Purpose – sentence stating the
purpose of study
For defining the scope of your
paper major research question or questions should be
addressed in the paper. Secondary research questions should
also be listed.
Importance of the research
question and its potential relevance to policymakers should
be described briefly.
List the hypotheses that the
paper will examine.
Describe the method of analysis
to be employed. The methods used could include legal
analysis, econometric analysis, interview techniques,
research of primary sources—all of which have shortcomings
that require thought. Studies should use the methodology
that is appropriate. In order to ensure that wide range of
readers understand the paper, it is required that when
econometric methods are used, the results are presented in
simple tabular or graphic form. Also mention the drawbacks
of the methods used and the steps you will be taking to
Where empirical analyses are
envisaged, a detailed account of the likely data sources,
dependent and independent variables, and estimation
techniques should be given.
An account of the potential
findings of the paper. What matters or debates will your
paper shed light on? What can policymakers learn from the
possible findings of your study? We recognise that you
cannot know with certainty what the findings of your paper
will be—but before commencing the analysis it should be
possible to think through what the different possible
conclusions will be.
Describe which audiences are
likely to find your potential findings of interest. The
audience could include national policymakers (in which
agencies or ministries?), officials in international
organisations (name of such organisations?), participants in
discussions in international forum (which participants?
which forum?), the private bar, corporate interests, and
last but not least civil society (including consumer
organisations and journalists.)
Describe the likely caveats to
your approach and likely findings.
The theme for the second research
cycle of CDRF is “Institutional Issues covering Political
Economy and Governance Constraints in Implementing Competition
and Regulatory Regimes in the Developing World”.
Following research areas have been identified under this theme.
The authors may select one or a combination of the research
areas for their papers.
Do conflicting objectives of
stakeholders act as hindrance to effective implementation of
Competition and Regulatory Regimes
A dynamic and competitive
environment, underpinned by sound competition law and policy, is
essential characteristics of a successful market economy.
Effective enforcement of competition law and active competition
advocacy can also be powerful catalysts for successful economic
restructuring. Although, the field of competition law and policy
is evolving rapidly and includes very different viewpoints on
issues, recognition is growing that effective competition law is
important in shaping business culture and that its proper
implementation needs to allow for the education of the business
people, politicians and the consumers.
Attempts to take into account
multiple objectives in the administration of competition and
regulatory policy may give rise to conflicts and inconsistent
results. Various stakeholders (Politicians, Business and
Consumer) perceive ‘competition’ with different objectives and
these objectives are of conflicting nature. However, the role of
regulatory authorities may not be well understood and there may
be lack of competition culture, which may constrain both
adoption and implementation of competition and regulatory
regimes in developing countries.
The government’s commitment to
growth as a political objective, political maturity and overall
political climate in developing countries may matter much more
than developed countries. In this situation, it might be
important to properly align the Competition policy outcomes and
incentives for politicians and businesses so that adoption of
competition/regulatory law can get a political and business
buy-in. If competition law and policy is to yield all the
envisaged benefits, political will and consensus for reform
amongst different stakeholders may be very important. Adopting
or strengthening an existing law by itself may not help.
Further, Competition Law in
developing countries are expected to serve the certain
objectives of different stakeholders other than promoting
efficient markets. Here it would be important to consider
whether certain (even legitimate) objectives of stakeholders are
best served by government policies other than Competition Policy
and Law. This is the argument used by many Competition Law
experts in developed countries who are baffled by the desire of
many developing countries to use Competition Law to attain
objectives other than promoting efficiency. Here it is also
important to address that whether every government priority
manifest itself in the objectives of each government agency.
When this does not seem to happen for central banks then why
should it happen for Competition agency?
Key Research Question
Whether objectives of various
stakeholders are best served by government policies and rules
other than Competition Law?
Why is an efficiency-only
perspective as the objectives of Competition Law so
unacceptable in developing countries?
In what ways the conflicting
objectives of various stakeholders( politicians, business and
the consumers ) can be aligned?
What are the experiences of
educating various stakeholders about the benefits of
implementing Competition and Regulatory Regime in developing
Does government’s commitment to
growth as a political objective and overall political climate
in a country matter for the success of competition and
Is it important to align
‘competition policy outcomes’ and ‘incentives for
politicians’, so that adoption of competition/regulatory law
gets a political buy-in? If yes, then how it can be achieved?
If at all, the interest of
consumers and new businesses that are expected to benefit from
open markets and competition can be protected?
Resolving Conflict between
Competition and Regulatory Authorities
There are several dimensions to any
discussion of the relationship between competition and
regulatory authorities. First, there is the question of
relationship between competition policy and regulation in the
most general sense, which refers to governments, laws and
regulation. Second there is a question of competition and
regulated industries i.e. public utilities.
The possibility of simultaneous
intervention of the sectoral regulators and the Competition
Authority has been publicly discussed mainly in legal terms and
in relation to the expertise and to the nature of instruments
available to each authority. The typical argument is: The
Competition Authority acts as a monitoring entity. It verifies
ex post whether or not firms have adopted anti-competitive
conduct. On the other hand, sectoral regulatory authorities
intervene ex ante, enacting regulatory measures aimed at
avoiding the exercise of monopoly power in regulated markets,
for example the setting of high prices or inefficient investment
decisions. Alternatively, one could imagine that both
authorities are on an equal footing, and each investigates where
it sees a need to intervene.
Government in most developing
countries have not put in place a mechanism to synchronise
regulatory activities. The multiplicity of regulations and
concurrent jurisdiction could lead to forum shopping. Where a
case comes under the purview of both the sector regulatory law
and competition legislation, parties to the case might have to
approach both the regulators for clearance, thereby increasing
transaction costs. The lack of coordination often leads to
policy discrepancy and creates regulatory uncertainty for
But, the clash between regulators
and competition agencies is often a function of the objectives
of the former, which in turn, vary a lot across sectors. The
objectives of sectoral regulators vary according to the nature
and requirement of different sectors and at the same time the
there are variations across developing countries at different
stages of development. Thus, there are three dimensions of this
problem that is; ex-ante design versus ex-post coping strategy,
variations across sectoral regulators objectives, and variation
across developing countries.
The solution to the overlapping
jurisdiction could be to legislate clear mandates for regulators
and the competition authority. It is best to leave the
determination of behavioural issues to competition authorities,
and structural issues to the regulatory authorities. Across
sectors, some basic principles of competition must prevail.
Key Research Questions
Developing countries face the
problem of conflict between different regulatory
laws/agencies. In what ways we can ensure regulatory coherence
among these agencies?
In case of concurrent
jurisdiction( which generally happens in developing countries)
between competition authority and sector regulators, what is
the right thing to do?
The clash between regulators and
competition agencies is often a function of the objectives of
the former, which in turn, vary a lot across sectors. In what
ways the problem of ex-ante design versus ex-post coping
strategies can be minimised in developing countries?
In what ways the model of
entrusting ex-ante regulation to sector regulators and ex-post
to competition authority is workable in developing countries?
What have been the experiences of developing countries in
implementing this model?
How to align between the varying
objectives of different sectoral regulators in developing
countries specially, when there are variations across these
Are there specific instances in
developing countries which highlight the dilemmas, trade offs
and policy choices in this area?
What factors determine
convergence/divergence in decisions of competition authority
and sectoral regulators with respect to competition issues in
Protection of Public
Interest vis-à-vis Promotion of Efficient Market
According to Several scholars States
should play a limited role in the enforcement competition in the
market, especially in the matters of national or global
importance. Microsoft case illustrates the costs of State
intervention in competition matters. These scholars further
express that States often focus on certain short term interests
rather than broader concerns for efficiency and equity.
The public interest theory of
competition policy emphasises that the Competition Law attempt
to improve market performance by regulating market structure,
behaviour and by protecting and promoting competition crucial to
the success of a market economy in promoting efficiency and
delivering the ensuring benefits to consumers. While, the
government claims that it interfere in the market to serve the
public interest but this interference may be susceptible to the
influence of some interest groups as is any other government
Public interest is an important
policy objective for governments in developing countries
generally having a large informal sector and high unemployment.
But as experience of developing countries shows that if public
interest are dominated by vested interest and these dominate
political power, they might limit growth dynamics and can
curtail economic opportunities for poor consumer.
It appears to be a matter of ‘Common
Practice’ that a regulator is made to consider public interest
in its decision making process. The inherent conflict between
the objectives of efficient markets and public interest can lead
to situations of trade-off, which may be politically quite
sensitive. Moreover, regulatory authorities may not be able to
do much in situations that call for change in government
policy/rules. In such a politico-economic system, it may be
difficult for competition/regulatory authority to follow the
objective of promoting efficient markets.
This situation can also be seen in
developed country like USA where the federal antitrust agencies
seek to pursue efficiency related objectives while many State
antitrust agencies pursue a broader ‘public interest’ criteria.
This has caused some divergences in view about the effects of
certain proposed mergers in USA. The public interest standards
were very hard to cleanly implement in practice in USA and that
trying to do so had come at the expense of transparency and hurt
business planning. According to Prof Paul Joskow there should be
different agencies to review each distinct major objective that
State may have that is, if a State wants national security as
well as efficiency considerations to be taken into account in
merger reviews then there should be two distinct bodies to
undertake these reviews.
Key Research Questions
In what ways we can best align
government’s objective of promoting public interest and
regulatory authority’s objective of promoting efficient
If at all, how to balance the
trade-offs between efficiency and public interest objectives,
which may not be specifically mentioned in the law?
Should there be different agencies
to review each distinct major public interest objective that
State may have? Or do we need better quality institutions and
tools to deal with the issues of public interest?
Are there any lessons from US
experience concerning the appropriate choice of standards?