73637 NOTE NUMBER 331 viewpoint PUBLIC POLICY FOR THE PRIVATE SECTOR FINANCIAL AND PRIVATE SECTOR DEVELOPMENT VICE PRESIDENCY SEPTEMBER 2012 Competition Policy Markus Kitzmuller and Encouraging Thriving Markets for Development Martha Martinez Licetti A lite rature re v ie w s ho ws t ha t c o m p e t it io n p o lic y r e f o r m s a l l o w This Note was written as part of the Investment marke ts to work m o r e e f f ic ie nt ly f o r t he b e ne f it o f c o ns um er s a n d Climate Impact Project, d rive sustainab l e e c o no m ic g r o wt h. T hr e e m a in ins ig ht s e m e r g e : a joint effort of the World Greate r market c o m p e t it io n m a t t e r s f o r a c hie v ing g r e a t e r in n o v a t i o n , Bank Group’s Investment Climate Department, IFC’s p rod uctivity, and e c o no m ic g r o wt h. P o lic ie s t ha t he lp o p e n m a r k e t s Investment Climate and remove antic o m p e t it iv e r e g ula t io ns c a n p r o m o t e c o m p e t i t i o n , Business Line, and the World Bank’s re sulting in low e r p r ic e s a nd b e t t e r d e a ls f o r c o ns um e r s a nd f i r m s . Development Research And e f f e ctive enf o r c e m e nt o f c o m p e t it io n r ule s a c r o s s s e c t or s — r a t h e r Group, in collaboration with IFC’s Development than the p ure ex is t e nc e o f c o m p e t it io n la ws — m a k e s a d if f e r e n c e i n Impact Department, the the imp act of com p e t it io n p o lic ie s . Development Impact In recent years governments in developing coun- business practices (such as cartel agreements and Evaluation Initiative, the FPD Chief Economist’s tries have improved the investment climate and anticompetitive mergers). An effective compe- Office, and the Global streamlined procedures for starting a business so tition policy usually includes pro-competition Indicators and Analysis as to reduce barriers to market entry. But many sectoral policies and effective economy-wide Unit. The project is markets in developing countries remain subject enforcement of antitrust rules designed to deter funded by the U.S. Agency to entry barriers and to anticompetitive behavior anticompetitive practices (figure 2). Together, for International by a few dominant players (figure 1). Drawing these policies improve both domestic economic Development, the on a comprehensive set of studies, this Note out- performance and international competitiveness. THE WORLD BANK GROUP U.K. Department for lines empirical evidence showing that policies International to increase market competition can improve a Competition matters for productivity growth Development, and the country’s economic performance, increase busi- Competition drives productivity growth through World Bank Group’s ness opportunities and firm productivity, and ulti- two key mechanisms: it shifts market share toward Investment Climate mately benefit consumers through usually lower more efficient producers, and it induces firms to Department. prices for goods and services.1 become more efficient so as to survive.2 Competition policies involve a range of mea- Theoretical and empirical studies provide evi- sures designed to reduce or eliminate impedi- dence that product market competition boosts ments to well-functioning markets that arise from innovation, productivity, and economic growth.3 public policy interventions (such as statutory Firms facing vigorous competition have strong monopolies and price controls) and restrictive incentives to reduce their costs, to innovate, and COMPETITION POLICY ENCOURAGING THRIVING MARKETS FOR DEVELOPMENT Figure Many markets in developing countries are dominated by a few firms for more than 40 African countries, Gebreab (2002) found that the entry of an additional 1 Key markets by structure (%), 2010 operator increased mobile subscriptions by an Many firms A few large firms One firm 100 average 57 percent. Conversely, an OECD study (2012a) showed that weak market competition 80 37 41 45 49 47 in telecommunications alone cost the Mexican 56 59 60 economy around US$129.2 billion in 2005–09, or 32 1.8 percent of GDP a year. Also in Mexico, Urzua 40 30 44 (2009) estimated that market power exerted by 32 40 32 20 33 companies on key goods imposed welfare losses 31 25 20 15 13 13 on poor households 20 percent higher than those 8 0 on the highest-income households. Middle East Sub-Saharan Europe & East Asia South Latin America High-income & North Africa Africa Central Asia & Pacific Asia & Caribbean countries Effects of opening markets to competition Note: Data show averages for each region. Source: World Bank Group 2010. Competition in domestic markets affects the international competitiveness of national firms. to become more efficient and productive than Firms typically acquire many of their inputs— their rivals.4 This process motivates firms to offer transport, energy, telecommunications, finan- competitive prices, higher quality, and new and cial services—in local markets. If these upstream more varied goods and services. markets lack competition, goods and services Conversely, lack of competition adversely needed for production are not priced competi- affects productivity. Nickell (1996) found that tively. As a result, firms may be less competi- a 10 percent increase in price markups resulted tive than their foreign rivals and domestic GDP on average in a 1.3–1.6 percent loss in total fac- growth may suffer. Reforms to open key markets tor productivity growth. Carlin, Schaffer, and to competition have boosted productivity and Seabright (2004), focusing on 24 transition growth (table 1). economies, showed that firms facing between one and three competitors saw real sales grow A boost to agribusiness by almost 11 percent on average over three years Country studies point to the positive effects of while monopolists saw real sales decline by 1 pro-competition market reforms in agribusiness percent.5 Sekkat (2009) suggested that higher (Kompas and others 2009 for Vietnam; Porto, markups have had a significant negative effect Depetris Chauvin, and Olarreaga 2011 for Sub- on productivity growth in Jordan and Morocco. Saharan Africa). Investigating the effects of Competition also leads to savings and greater removing anticompetitive restrictions in East and access to markets for consumers. Analyzing data Southern Africa, Jayne and others (1996) found that eliminating controls on prices and private Figure Competition policies in practice trade in maize accounted for US$10.1 million of consumer savings a year in Kenya. The reforms also 2 Opening markets and removing anticompetitive market regulation Enforcing competition rules increased the availability of whole maize, which had previously been restricted by regulation. Analysis showed that the market share of whole maize rose Remove statutory monopolies, restrictions Tackle cartel agreements that raise the on the number of firms, or bans on private costs of key inputs and final products from 8 percent to about 49 percent in Zimbabwe investment and from about 10 percent to 35 percent in Kenya Prevent anticompetitive mergers Eliminate controls on prices and other within several years after the reforms were imple- market variables that increase business mented. risk Strengthen the antitrust framework to In Togo, Akiyama, Baffes, and Larson (2001) combat anticompetitive conduct Guarantee a level playing field and found that eliminating monopolistic commod- nondiscriminatory treatment of firms Control state aid to avoid favoritism ity boards for coffee increased growers’ share of the value received per unit of exports from less than 30 percent to 80 percent. Waithaka and Table Effect of competition policy reforms at the sectoral level 1 Sector and country Study Reform Effect Agribusiness Vietnam Kompas and others 2009 Land and market reforms moving from commune-based public Large increase in total factor productivity in main ownership and output share contracts to private property and rice-growing regions; national average annual market-driven production and pricing increase in rice output of 3.5% Kenya Jayne and Opening of market and elimination of price controls for maize Consumer savings of US$10.1 million a year (due to Argwings-Kodhek 1997 lower milling costs) Kenya, Jayne and others 1996 Elimination of controls on private trade and development of Increase in market share of whole maize, provided by Mozambique, alternative marketing channels in the maize market private millers, from 8% to about 49% in Zimbabwe and Zimbabwe and from 10% to 35% in Kenya Togo Akiyama, Baffes, and Elimination of monopolistic commodity boards Increase in share of export unit value growers Larson 2001 in coffee received from less than 30% to 80% Kenya, Waithaka and Standardization of variety testing procedures, seed Combined social (consumer and producer) surplus of Tanzania, others 2011 certification procedures, and plant introduction and US$18.5 million in Kenya, US$15.2 million in Uganda, and Uganda phytosanitary procedures for maize and US$6.4 million in Tanzania; increase in demand for certified seed maize of 98% in Kenya, 175% in Uganda, and 85% in Tanzania in 2000–08 Transport Lao PDR Arnold 2005 Breaking up of Lao PDR trucking cartel and opening Reduction in logistics costs on Bangkok–Vientiane of transit to all Thai truckers route of 30% Mexico Ros 2011 Opening of air transport and routes to low-cost entrants Reduction in air fares of up to 37% (on routes served by low-cost carriers) Cross-country Micco and Improvement in the quality of air transport regulation Reduction in transport costs of 14% panel Serebrisky 2004 Introduction of “open skies” agreements to Reduction in transport costs of 8% foster competition Professional services Italy Pellizari and Pica 2011 Removal of price floors and advertising ban in More productive lawyers more likely to stay in the legal profession the profession Australia EC 2004 Elimination of the exclusive rights of lawyers Potential drop in overall legal costs of 12% Retail and services Ukraine Shepotylo and Liberalization of services Increase in total factor productivity of 3.6% Vakhitov 2012 India Amin forthcoming Opening of retail market to competition Increase in labor productivity of as much as 87% United States Goos 2005 Deregulation of shop opening hours Increase in employment of 4.4–6.4% and in total revenue of 3.9–10.7% in deregulating industries United Kingdom Maher and Wise 2005 Liberalization and pro-competition regulations Increase in productivity growth of more than 10% in gas, water, and electricity others (2011) estimated that more competition study of 30 African and Latin American coun- for seed in East and Central Africa led to sav- tries Wallsten (2001) found that each additional ings of US$49.1 million for consumers in Kenya, competitor is associated with an increase of about Tanzania, and Uganda between 2000 and 2008. 0.2 mainlines per 100 inhabitants. Similarly, in an analysis spanning 30 countries and more than Lower costs in telecoms and transport 16 years Li and Lyons (2011) showed that more There is abundant evidence of the positive effects competitors, privatization, and the existence of of competition in telecommunications. In a an independent regulator increased subscriber COMPETITION POLICY ENCOURAGING THRIVING MARKETS FOR DEVELOPMENT penetration from 2 percent on average to 97 restrictive regulations imposed by local govern- percent. ments but also by self-regulations imposed by pro- In transport, eliminating anticompetitive fessional associations. In East Africa professional behavior and entry barriers reduced transport associations (of lawyers, notaries, accountants, costs and prices. In Chad the existence of car- and architects) impose minimum prices and high tels in the main corridors doubled transport fees that increase service costs by more than 10 prices (Arvis, Raballand, and Marteau 2010). percent and restrict the entry of new providers Conversely, breaking the cartel in the Lao (World Bank 2010). People’s Democratic Republic and opening tran- 4 sit to all Thai truckers in 2004 reduced logistics Labor productivity gains in retail costs on the Bangkok–Vientiane route by 30 per- In retail and services pro-competition sectoral cent (Arnold 2005). After Mexico opened road policies have been found to increase both labor freight to competition in 1989, cheaper, more and total factor productivity growth. In an empir- customer-responsive trucking services made it ical analysis of 1,948 retail stores located in 41 possible for downstream companies to offer new, cities in India, Amin (forthcoming) estimated previously unavailable products and reach previ- that pro-competition reforms can improve labor ously unserved areas (Dutz, Hayri, and Ibarra productivity by about 87 percent.6 And deregula- 2000). tion of shop opening hours has been found to In air transport the entry of low-cost airlines increase employment in the sector (see table 1). and the liberalization of air cargo markets have Conversely, regulations such as price controls been found to significantly benefit consumers and restrictions on the establishment of large through lower transport costs and greater price outlets impede efficiencies and productivity competition. Ros (2011) found that incumbents gains (Foster, Haltiwanger, and Krizan 2006). in Mexico charged prices 37 percent lower on average in routes where they faced competitors. Broad effects on employment and growth Analyzing a panel data set, Micco and Serebrisky Eliminating barriers to competition also has a (2004) estimated that improving the quality of air positive impact on employment and growth. In a transport regulation from the level of Ecuador cross-country study Nicoletti and Scarpetta (2005) (25th percentile) to that of France (75th) showed that reforms that would reduce the most reduced transport costs by 14 percent—while pronounced state controls and barriers to competi- introducing “open skies” agreements to foster tion observed in a sample of 20 OECD countries— competition reduced them by 8 percent. to meet OECD best-practice levels—would increase long-run employment rates by 2.5–5.0 percentage Higher productivity in professional services points. And in a study of Croatia, De Rosa and Greater competition also matters in professional others (2009) estimated that removing anticom- services. Pellizari and Pica (2011) found that in petitive regulation in energy, telecommunications, Italy the removal of price floors and other restric- and transport would increase GDP per capita by tions on competition was associated with greater 1.35–2.77 percent. productivity and lower attrition among lawyers of higher ability. A study using product market regu- The importance of effective competition lation data from OECD countries suggested that enforcement liberalizing professions would generate among It is not the existence of competition rules, but the most significant gains from deregulation and their effective enforcement, that matters most for have a significant impact on growth in down- economic performance. In a study of 42 coun- stream industries (Barone and Cingano 2011). tries Kee and Hoekman (2007) found that in In Australia it was estimated that eliminating the industries where competition rules were actively exclusive rights of lawyers would reduce overall enforced, enforcement increased the number of legal costs by 12 percent (EC 2004). domestic firms by 7.2 percent (table 2). Buccirossi In developing countries the growth of profes- and others (forthcoming) looked at the relation- sional services is usually constrained not only by ship between productivity growth and the overall Table Effect of competition policy reforms at the economy-wide level 2 Policy area and country Study Reform Effect Comprehensive competition law or policy Cross-country Kee and Hoekman 2007 Introduction of competition law; elimination of restrictive Increase in domestic firms of 7.2% government regulations Panel Buccirossi and others Increase in quality of institutional and enforcement Total factor productivity growth of 1% resulting from forthcoming policies as measured by a competition policy index 20% increase on index scale—roughly equivalent to moving from level of enforcement in the Czech 5 Republic to that in the United Kingdom Cartel or antitrust enforcement United Kingdom Symeonidis 2008 Introduction of cartel law (the Restrictive Trade Practices Act) With intensification of price competition, closure of a in 1956 20–30 percentage point gap in labor productivity growth between cartelized and competitive industries United States Werden 2008 Cartel enforcement Total consumer savings in 2000–07 estimated at about US$1.85 billion United States Block, Nold, and Sidak 1981 Higher level of enforcement (as approximated by changes in Reduction in price markups budget of competition authority) Leniency in antitrust enforcement United States Miller 2009 Introduction of leniency program in 1993 59% decrease in cartel formation; 62% increase in rate of discovery of existing cartels Merger control Netherlands Postema, Goppelsroeder, Merger control Net benefits to society estimated at about €100 million and Bergeijk 2006 a yeara Pro-competition sectoral and competitive neutrality policies Australia Australian Productivity Elimination of anticompetitive regional policies; introduction Drop in average real electricity price of 19%, in rail Commission 2005 of competitive neutrality principles freight rates of 8–42%, and in real port charges of up to 50%; increase in GDP of 2.5% a. This estimate is based on a cost-benefit analysis contrasting the potential and actual costs of implementing a merger control policy with its benefits to society. quality of institutional and enforcement policies driving total factor productivity growth. For a as measured by a competition policy index. A developing country, de facto independence of 20 percent increase on the index scale—roughly the competition authority will translate into a 17 equivalent to moving from the level of enforce- percentage point reduction in the productivity ment in the Czech Republic to that in the United gap with the United States (Voigt 2009).7 Kingdom—results in total factor productivity Country studies confirm these findings. In growth of 1 percent. Australia competition policy reforms boosted GDP by 2.5 percent, or US$20 billion, through Savings to consumers and firms higher productivity and lower prices during the Cross-country studies reveal that antitrust 1990s (Australian Productivity Commission 2005; enforcement has a significant positive effect on Crawford 2009).8 Similarly, conservative estimates productivity growth. This result is robust across for the United Kingdom suggest that the enforce- developed and developing countries alike. In ment of competition law has led to US$112 million developing countries de facto independence of a year in direct consumer savings (U.K. Office of the competition authority—as reflected in the Fair Trading 2010). In the Netherlands the com- autonomy of its decisions—and an emphasis on petition agency’s overall activities are estimated to promoting competition play a crucial part in increase social welfare by US$426 million (a three- COMPETITION POLICY ENCOURAGING THRIVING MARKETS FOR DEVELOPMENT year rolling average) (Netherlands Competition a year in industries characterized by collusion but Authority 2012).9 And recent studies provide evi- grew by 16 percent a year in industries character- dence that budgetary commitments to competi- ized by competition. When a strict cartel law was tion agencies and institutions are associated with introduced and enforced, this gap disappeared. higher per capita GDP growth (Clougherty 2009). Benefits from other effective enforcement Gains from combating cartels measures Addressing cartel behavior is a critical area of Besides enforcement, other measures can help antitrust enforcement. In developing coun- reduce the anticompetitive impact of cartels. 6 tries cartels have been associated with price Leniency programs—which reduce punishments increases of 10–45 percent (Levenstein, Suslow, for colluding firms that cooperate with compe- and Oswald 2003; Yu 2003). Besides increasing tition authorities and provide information that the cost of goods and services to do business, helps in detecting a cartel—have been shown to cartels are associated with low labor productiv- provide an effective incentive for whistle-blowing. ity and low incentives to innovate (Broadberry Miller (2009) found that a leniency program in and Crafts 2001; Evenett, Levenstein, and Suslow the United States reduced the rate of cartel for- 2001; Symeonidis 2003).10 mation by 59 percent and increased the rate of Tough cartel enforcement is an effective tool cartel detection by 62 percent. A central part for reducing the adverse effects of anticompeti- of cartel prosecution today, leniency programs tive behavior (Symeonidis 2008; Alexander 1994). complement pure economic reasoning and stan- Moreover, evidence suggests that international dard investigative techniques. cartels target countries without cartel enforce- In addition, effective merger control policy ment (Evenett and Clarke 2002). Eliminating anti- has been found to prevent transactions that may competitive agreements has had a big impact in cause significant harm to market competition. markets affected. Evenett, Levenstein, and Suslow Postema, Goppelsroeder, and Bergeijk (2006) (2001), analyzing a sample of 40 international car- showed that merger control in the Netherlands tels in the 1990s, found price drops on the order led to net benefits of about €100 million a year. of 20–40 percent after cartels were broken up. In the United States the Department of Justice Werden (2008) estimated consumer savings from reported consumer savings of about US$1 billion cartel enforcement in the United States between for fiscal 2009. In the United Kingdom the Office 2000 and 2007 at about US$1.85 billion. of Fair Trading estimated consumer savings of at Evidence suggests that cartel overcharges least £640 million in 2000–05, without taking into vary with the level of antitrust scrutiny. Bolotova, account the deterrence effects of merger control Connor, and Miller (2007), looking at time-series on anticompetitive transactions (OECD 2012b). data covering 270 food product markets between Competition rules to minimize distortive state 1780 and 2004, found that food cartels imposed aid schemes may also affect productivity. Recent an average overcharge of 19 percent. The longer research by Aghion and others (2012) revealed the cartels were in place, the more successful that lower growth is registered in sectors where they became in imposing higher prices; every subsidies and aid are concentrated in a few firms. five additional years a cartel operated added 1.54 Thus discriminatory or selective subsidization poli- percentage points to the overcharge. Cartel over- cies are mostly detrimental to productivity growth, charges were lower in regions and periods with especially in developing countries (Harrison and tougher antitrust enforcement. Rodriguez-Clare 2010). An even stronger result on the importance of cartel enforcement comes from a natural Conclusion experiment in the United Kingdom.11 Symeonidis Competition policy is a key part of the devel- (2008) showed that cartels reduced labor pro- opment agenda. Evidence from the literature ductivity growth by up to 30 percentage points confirms that greater market competition has in a nine-year period. Before competition policy a positive effect on economic performance and reforms, labor productivity declined by 2 percent productivity growth over a wide range of sectors. Studies also show that competition policies can 6. The analysis used instrumental variables to account indeed increase or sustain competition within or control for endogeneity and reverse causality. sectors and across economies. Reforms that open 7. This is consistent with a one-standard-deviation markets and remove anticompetitive regula- increase in independence. tion—such as price controls, statutory monopo- 8. This conservative estimate does not consider the ef- lies, restrictions on the number of firms, and fects of dynamic efficiency gains from more competitive discriminatory treatment of certain firms—lead markets. to significant productivity gains. Effective imple- 9. The social welfare benefits were estimated using a mentation of competition and antitrust rules to method revised in 2008. 7 address cartel behavior, anticompetitive mergers, 10. Levenstein and Suslow (2004) showed that price and distortive subsidies is essential. The mere increases due to international cartels range from 10 to existence of laws and regulations is not enough. 100 percent. In 1997 roughly 3.7 percent of total imports to developing countries came from cartelized industries. 11. The natural experiment consisted of the change in the legal and policy environment, which made it pos- Notes sible to identify and attribute changes in productivity. Markus Kitzmuller (mkitzmuller@worldbank.org) is an economist, and Martha Martinez Licetti (mlicetti@ Bibliography worldbank.org) a senior economist and the competition For a list of all studies cited in this Note, along with other policy team leader, in the World Bank Group’s Investment studies relating to the effect of competition policy reform, Climate Department. The authors thank Paulo Correa, go to http://www.worldbank.org/fpd/viewpoint331/bib Russell Pittman, and Tomas Serebrisky for valuable com- liography. ments and suggestions. This Note further benefits from discussions and comments by Tania Begazo, Cecile Fruman, Key studies Jana Krajcovicova, Miguel Laric, Christine Zhenwei Qiang, Aghion, P., and R. Griffith. 2005. Competition and Massimiliano Santini, and Erik von Uexkul. This Note pres- Growth: Reconciling Theory and Evidence. Cambridge, ents the findings of studies that address whether competition MA: MIT Press. reforms have a positive effect on productivity and economic Akiyama, T., J. Baffes, and D. Larson. 2001. Commodity performance. It does not attempt to provide an exhaustive Market Reforms: Lessons of Two Decades. World Bank review of the impact of competition reforms on other eco- Regional and Sectoral Study. Washington, DC: nomic variables such as trade or foreign direct investment. World Bank. 1. The studies reviewed include cross-country and Alesina, A., G. Ardagna, G. Nicoletti, and F. Schiantar- panel data analysis as well as country-specific data and elli. 2005. “Regulation and Investment.” Journal of the case studies. European Economic Association 3 (4): 791–825. 2. Productivity as used in this Note refers to both total Amin, M. Forthcoming. “Competition and Labor Pro- factor productivity and multifactor productivity, terms ductivity in India’s Retail Stores.” Journal of Compara- used interchangeably in the literature. tive Economics. 3. Firm-level evidence of the positive link between Arnold, J. 2005. Trade and Transport Facilitation in Laos. product market competition and productivity perfor- Washington, DC: World Bank. mance is provided by Nickell (1996); Blundell, Griffith, Barone, G., and F. Cingano. 2011. “Service Regulation and Van Reenen (1999); and Aghion and others and Growth: Evidence from OECD Countries.” (2005). Economic Journal 121 (555): 931–57. 4. For empirical results on the impact on productivity Bourles, R., G. Cette, J. Lopez, J. Mairesse, and G. growth, see, for example, Conway and others (2006); Nicoletti. 2010. “Do Product Market Regulations in Alesina and others (2005); and Aghion and Howitt Upstream Sectors Curb Productivity Growth? Panel (2006). On the impact of import competition, see Data Evidence for OECD Countries.” NBER Work- Bloom, Draca, and Van Reenen (2011); and Fernandes ing Paper 16520, National Bureau of Economic and Paunov (2009). Research, Cambridge, MA. 5. Firms with more than three competitors exhibited Buccirossi, P., L. Ciari, T. Duso, G. Spagnolo, and sales growth rates of slightly less than 2 percent. C. Vitale. Forthcoming. “Competition Policy and COMPETITION POLICY ENCOURAGING THRIVING MARKETS FOR DEVELOPMENT Productivity Growth: An Empirical Assessment.” Symeonidis, G. 2008. “The Effect of Competition on Review of Economics and Statistics. Wages and Productivity: Evidence from the UK.” Jayne, T. S., and G. Argwings-Kodhek. 1997. “Consumer Review of Economics and Statistics 90 (1): 134–46. Response to Maize Market Liberalization in Urban U.K. Office of Fair Trading. 2010. “Positive Impact Kenya.” Food Policy 22 (5): 447–58. 09/10: Consumer Benefits from Competition Kee, H. L., and B. Hoekman. 2007. “Imports, Entry and Enforcement, Merger Control and Scam Busting.” viewpoint Competition Law as Market Disciplines.” European OFT Paper 1251. London. Economic Review 51 (4): 831–58. Urzua, C. 2009. “Distributive and Regional Effects of Levenstein, M., and V. Suslow. 2004. “Contemporary Monopoly Power.” EGAP Working Paper 2009-04, is an open forum to International Cartels and Developing Countries: Tecnológico de Monterrey, Campus Ciudad de encourage dissemination of Economic Effects and Implications for Competition México. public policy innovations Policy.” Antitrust Law Journal 71 (3): 801–52. Voigt, S. 2009. “The Effects of Competition Policy on for private sector–led and Nicoletti, G., and S. Scarpetta. 2005. “Product Market Development: Cross-Country Evidence Using Four market-based solutions for development. The views Reforms and Employment in OECD Countries.” Eco- New Indicators.” Journal of Development Studies 45 (8): published are those of the nomics Department Working Paper 472, OECD, Paris. 1225–48. authors and should not be Ros, A. J. 2011. “The Determinants of Pricing in the Wallsten, S. 2001. “An Econometric Analysis of Telecom attributed to the World Mexican Domestic Airlines Sector.” Review of Indus- Competition, Privatization, and Regulation in Africa Bank or any other affiliated trial Organization 38 (1): 43–60. and Latin America.” Journal of Industrial Economics 49 organizations. Nor do any Shepotylo, O., and V. Vakhitov. 2012. “Services Liber- (1): 1–19. of the conclusions represent alization and Productivity of Manufacturing Firms: official policy of the World Evidence from Ukraine.” Policy Research Working Bank or of its Executive Paper 5944, World Bank, Washington, DC. Directors or the countries they represent. 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