Competition Policy: Definition and Scope. Presented by Dr. M. A. Razzaque. We are going to have discussions on:. What is Competition? What is Competition Policy? What it Covers? What is the need for Competition Policy?. What is competition?. Competition.
Dr. M. A. Razzaque
Literary meaning: a contestable situation where people fight for superiority.
In market economy, competition is a process whereby firms fight against each other for securing consumers for their products
Competition to win customers not by lowering price but by advertising, offering after-sales-service, using sales-promotion tools, etc.
Competition among suppliers to win customers by offering lower price. May not be an appropriate strategy for those loyal to a particular brand.
(Recent packages offered by Mobile Phone companies)
i) Economic policies adopted by Government, that enhance competition in local and national markets, and
ii) Competition law designed to stop anti-competitive business practices.
Components of competition policy
Capital and FDI
Anti-Competitive Agreements Between Firms
Regulation of Mergers to Prevent Tactics to Gain Excessive Dominance in a Market
Abuse of a Dominant Market Position
Benefits to Consumers
On the whole, a competition policy maintains and promotes the competitive spirit and culture in the market.
Therefore, we need competition policy to monitor, prevent and control anti-competitive practices.
Globalization and Competition
Concentration of Market Power
Examples : Natural Monopolies, like,
Infrastructure, Power and Railway .