Transversal Agency and Crowding Out

Pedro Barros, Steffen Hoernig, and Tore Nilssen

Mohr Siebeck

Mohr Siebeck

Published in:

Journal of Institutional and Theoretical Economics 2015 171 pp. 589-608.

DOI: 10.1628/093245615X14302136524798

Abstract:

A country's competition agency is transversal in the sense of being active in the whole economy. We study the interaction between the competition agency and sectoral regulators and establish a scope for sectoral regulators to crowd out each other's efforts: More effort on monitoring anticompetitive behavior by one sectoral regulator causes others to do less. We also find that when government agencies interact under consensus the competition agency spends more effort on the industry with the more consumer-biased sectoral regulator, while the opposite is true under independent decisions.

Published Dec. 10, 2015 11:15 AM - Last modified Dec. 16, 2015 2:52 PM