Regulatory Competition Research Articles

173 Industry perceptions of cannabidiol use in horses

Cannabidiol (CBD) use in horses has become more popular due to availability and anecdotal reports of its ability to reduce inflammation and illicit a calming effect. However, research demonstrating its efficacy and long-term health effects are limited. Additionally, there is no regulatory body or labeling requirements for horse products. This coupled with restrictions from national associations makes it difficult to explore therapeutic benefits of CBD in horses while adhering to competition regulations. The objective of this study was to gain insight into the equine industry's perception of CBD use in horses. A convenience survey of 133 equine industry professionals assessed both attitudes and behaviors related to CBD use in horses. A Qualtrics survey link was distributed via an extension specialist email listserv and Facebook page. Data were analyzed using descriptive statistics including frequency, percentage, mean and standard deviation. Differences in attitudes between groups were compared using independent samples t-test. Data are presented as mean ± standard deviation. Most respondents were female (91%), reported riding competitively (65.4%), manage a range of 1–24 horses, and report utilizing equine supplements (75.2%), only 28.6% of respondents indicated they currently use equine CBD products. As expected, those who reported administering CBD products have a more positive attitude (4.3 ± 0.6)toward CBD usage than those who do not (3.4 ± 0.9) (t97.1 = −6.6). However there is no difference in attitude toward CBD usage between those who ride competitively and those who do not. The number of horses managed by each respondent did not affect their attitude toward CBD usage. Most respondents (87.7%) indicated they were willing to pay up to $100 per product per horse regardless if they are currently using CBD products. In regards to efficacy, respondents believe that CBD products provide benefits for horses (67.2%) such as calming (47.6%) and believe it is an effective alternative to NSAIDS (44.3%) to reduce inflammation. They also believe that products should be labeled clearly (91%), should be legal to use in competitive associations (58%), and would recommend its use to others (53.3%), however only 6.1% indicate a licensed veterinarian has recommended its use. As more information becomes available and regulatory bodies make recommendations, associations are likely to make allowances for CBD use. There is a need for additional research defining therapeutic dosages and long-term physiological effects. In conclusion, the equine industry appears to have a positive attitude toward CBD use in horses despite the lack of concrete evidence and veterinarian recommendation.

Scharpf revisited: European welfare governance through the lens of actor-centred institutionalism

ABSTRACT The scholarship of Fritz Scharpf has inspired a leading strand in the debate on ‘social Europe’, but his arguments deserve more critical scrutiny than they have received. In contrast to his thesis about a ‘structural asymmetry’ that prevents the EU from functioning as a social market economy, national welfare provision has not been systematically undermined by regulatory competition, supranational liberalisation and fiscal rules, whereas there has been more positive integration of social policies than he anticipated. I contend that we can gain a richer theorisation of European welfare governance by challenging Scharpf on his own terms, which entails recovering key elements of his actor-centred institutionalism. From this perspective, I discuss four dimensions along which we should reconsider the relation between European integration and national welfare regimes: the cognitive and normative orientations of decision-making actors, the role of interaction orientations and socialisation, social policymaking as a problem-solving process beyond distributive bargaining, and the bounded legitimation of the EU as a diverse union of welfare states.

The price effects of reducing payment card interchange fees

In this paper we empirically address the issue of whether reductions in card payment interchange fees have a significant impact on prices paid by consumers. The answer to this question is at the core of most competition policy cases and regulations that have been applied to card payment markets. Relying on Rochet and Tirole’s (RandJEcon 33:549–570, 2002) model of this sector as a two-sided market, we identify the two channels through which interchange fee reductions may influence retail prices: the impact on cards’ demand and on the merchant service charge, which may be passed through to retail prices. We use Spanish sectoral data to estimate the resulting system of equations. Our results imply that a 1% reduction in the level of the interchange fee leads to a long run 0.17% reduction in the retail price index. Such outcome is almost exclusively the result of the interchange fees being passed through as lower prices by merchants, as we find that they have a negligible impact on payment cards’ usage.

Competition enforcement versus regulation as market-opening tools: an application to banking and payment systems

Abstract This article analyses three routes for the formation of market-opening rules: competition enforcement, legislative rulemaking, and market investigation. Using examples and case studies related to facilitating market access in banking and payment systems, we illustrate essential features and limitations of the different modes of rulemaking. The interrelation between them is explored, emphasizing the merits of having them available in parallel.

Spamming the regulator: exploring a new lobbying strategy in EU competition procedures

Abstract Regulation plays a central role in modern governance; yet, we have limited knowledge of how subjects of regulation—particularly, private actors—act in the face of potentially adverse regulatory decisions. Here, we document and examine a novel lobbying strategy in the context of competition regulation, a strategy that exploits the regulator’s finite administrative capacities. Companies with merger cases under scrutiny by the European Commission’s Directorate General for Competition appear to be employing a strategy of ‘spamming the regulator,’ through the strategic and cumulative submission of economic expert assessments. Procedural pressures may result in an undeservedly favourable assessment of the merger. Based on quantitative and qualitative analyses of an original dataset of all complex merger cases in the European Union 2005–2020, we present evidence of this new strategy and a possible learning process among private actors. We suggest remedies to ensure regulatory effectiveness in the face of this novel strategy.

Emerging challenges in competition policy and regulation

Emerging challenges in competition policy and regulation

Model-based simulation-optimization of irrigation scheduling – A field evaluation with processing tomatoes

Due to climate change, increased regulation of water resources and competition from other beneficial uses, the agricultural sector is under pressure to use water more efficiently. This paper reports the field evaluation of two model-based simulation-optimization approaches for irrigation scheduling: deterministic optimization and stochastic optimization. The field experiments were conducted at the University of California Davis research farm with a processing tomato crop. The crop growth simulation model used in the study was DSSAT-CROPGRO processing tomato. In order to mitigate the impact of weather forecasts inaccuracies, irrigation schedules were updated every 5 to 10 days, depending on operational constraints. These updates were performed via custom graphical user interfaces that enabled the user to visualize the expected outcomes of various decisions or scenarios before choosing which irrigation schedule to implement. An irrigation treatment based on manual monitoring of soil water content with a field-calibrated neutron probe served as benchmark. The model-based treatments achieved yields and water use efficiencies that were not significantly different from those obtained in the neutron probe-based treatment. These results demonstrate the high potential of model-based simulation-optimization approaches for in-season adaptive irrigation scheduling, especially since neutron probes, which are considered one of the most accurate indirect methods of measuring soil water content, are not commonly used by growers.

The trade effects of product market regulation in global value chains: evidence from OECD and BRICS countries between 2000 and 2015

Global Value Chains (GVC) have reshaped the landscape of international trade. The quality and intensity of regulation significantly impacts firms' competitiveness and their ability to engage in GVC. Economic literature suggests that regulation of product market competition has a detrimental effect on trade by decreasing productivity, innovation, and economic growth. This paper expands existing knowledge on this relationship by examining the influence of product market regulation (PMR) on value-added trade flows in an augmented gravity model. We constructed a data panel with trade data from 40 OECD and BRICS countries in the period from 2000 to 2015 and combined it with an extensive multi-level indicator set on PMR developed by the OECD. By disentangling the PMR indicators, we account for the heterogeneity of regulation and potential different trade effects. Overall, our evidence suggests that PMR has a negative impact on trade. Further, our results indicate that the negative impact stems largely from barriers to trade and investment. For the BRICS, our results suggest the contrary: We observed an overall positive trade effect of PMR, mainly driven by barriers to trade and investment. Our results support identifying policy areas in which regulatory reform can improve the integration in GVC and emphasize different approaches to economic policy, particularly in emerging economies such as the BRICS. Moreover, the results underline the detrimental effects of increasing protectionism and tariff hikes, a phenomenon that we increasingly observe in recent years from the world’s largest economies, such as the United States and China.

Doktrina neophodnih kapaciteta i zaštita konkurencije u Srbiji: sektor telekomunikacija

The paper discusses possibilities for the application of the essential facilities doctrine in the Serbian telecommunications sector and the consequences of that application for the protection of competition. Based on the findings in the paper, the conclusion is, among other things, that the essential facilities doctrine may be applied in different ways and under different conditions by the Regulatory Agency for Electronic Communications and Postal Services (RATEL), the Commission for Protection of Competition (KZK), as well as the Administrative Court. Furthermore, bearing in mind the existing relationship between these bodies, as well as the relationship between the law on protection of competition and sectoral regulation, we conclude that KZK should primarily apply the essential facilities doctrine, while RATEL is the one to additionally enhance competition within the sector based on the sectoral regulation.

The EU Green Bond Standard: A Plausible Response to the Deficiencies of the EU Green Bond Market?

The article elaborates on the EU Green Bond Standard, a cornerstone of the Proposal for a Regulation on European green bonds that was put forward by the European Commission in July 2021. Within the analysis, three research questions are posed. First, the article deals with the question of whether the EU Green Bond Standard is really needed; particularly, whether there is a need for EU regulatory intervention on the EU green bond market. Second, it examines the method of regulation which was adopted for the EU Green Bond Standard. Specifically, does this standard differ and offer any added value compared to private standards for the issuance of green bonds? Finally, the article discusses the impact of the EU Green Bond Standard on the EU green bond market. Within this section, the questions of fragmentation and regulatory competition between public (EU) and private regimes are dealt with. The article ends with proposals for modifications of the EU Green Bond Standard. It has been suggested that the EU Green Bond Standard should have a mandatory character for all issuances of green bonds on the EU green bond market. Private standards should not be replaced by the EU Green Bond Standard but only reconciled with it. With regard to its content, the EU Green Bond Standard should constitute a mixture of public and private obligations; yet, some necessary regulatory space should be left for private standards.

International Competitiveness and Financial Regulators’ Mandates: Coming Around Again in the UK

Abstract Using post-Brexit regulatory freedom to strengthen the financial sector has been seen as a priority for the UK government under the Conservative Party following the 2017 general election. The laying before Parliament of the Financial Services and Markets Bill (July 2022) marked the start of a multi-year process aiming to transform the regulatory framework. Adding a competitiveness and growth secondary objective to regulatory mandates was an important part of the reform agenda set out in the Bill. This article draws on theory (regulatory competition, regulatory procyclicality, and regulatory design) and recent history (post 2008-crisis regulatory reform) to question the wisdom of reinstating international competitiveness in regulatory mandates in this way. The key concern is that this change risks opening the door to an excessively deregulatory agenda and the undermining of regulatory independence. That the new competitiveness and growth objective will be used to advance deregulatory agenda was already becoming evident during 2022 as the UK debated the adaptation and evolution of EU-derived prudential and capital market laws to suit its new situation. Since the competitiveness and growth objective bandwagon may have become unstoppable, the article directs attention to the role of accountability in protecting regulatory independence. Regulators need to be able to resist pressure to lower standards unduly, and an effective system of accountability can support them in doing so.

The antitrust privacy dilemma

ABSTRACT Antitrust cases related to privacy are on the agenda of many competition authorities, including Europe and the United States. Antitrust and privacy is thus “one of the big topics of the year”, as stated by the former President of the French competition authority. While some antitrust cases concern a reduction in privacy protection, others concern an increase in privacy protection. In other words, user privacy can decrease or increase due to alleged anticompetitive practices. An antitrust privacy dilemma? From a law and economics standpoint, the paper solves this dilemma and proposes a new way of resolving antitrust cases related to privacy. Section 2 analyses the dilemma. It proposes an analytical framework. Section 3 proposes a new way of resolving cases. It suggests a coordinated participative approach with competition and non-competition regulators and stakeholders to address competition and privacy concerns with tailored remedies to what is necessary without eliminating pro-privacy effects.

The Merit Order Effect and market power in the Spanish electricity market

This study attempts to assess the Merit Order Effect (MOE) in Spain during the last decade 2011-2021, this is, the impact of renewable energy sources (RES) in electricity prices. Moreover, it analyses the effects of market concentration on prices and the interaction between the MOE and market power. The topic is significantly relevant at the time of writing for a number of reasons, including the expected growth of RES in Spain, the spectacular recent rise in electricity prices and the oligopolistic nature of the Spanish electricity sector. This study finds that there exists a MOE in the Spanish electricity market that reduces the price of electricity by 0.0029€/MWh for an additional solar MWh and by 0.0023€/MWh for an additional wind MWh. Moreover, it is found that market power increases electricity prices substantially. As the crucial result of this study, it is shown that the MOE can be limited and reduced by market concentration. This last point is particularly relevant because it demonstrates that the MOE does not only depend on RES supply itself, but also on the competitiveness of the market. Consequently, policymakers and competition regulators should strive to make the electricity market more competitive if the economic benefits of the energy transition are to be fully realised by the general public.

КОНВЕРГЕНЦІЯ НАЦІОНАЛЬНИХ ЕКОЛОГО-ЕКОНОМІЧНИХ ПОЛІТИК В КОНТЕКСТІ ЕКОЛОГО-ЕКОНОМІЧНОГО ЗРОСТАННЯ

The mechanisms of convergence in national eco-economic policies have been considered. The convergence of social-economic development in Ukraine has been evaluated. The mechanisms of harmonization, imposition, diffusion, and regulatory competition have been investigated. The essence and peculiarities of convergence assessment have been analyzed. A generalized typology of policy convergence mechanisms has been proposed, which includes harmonization, imposition, diffusion, and regulatory competition, playing a significant role in achieving eco-economic policy convergence and creating a favorable environment for sustainable development and economic growth. It has been determined through which intermediate mechanisms these structural changes and "modernization forces" affect domestic policy. It has been found that diffusion constitutes a third and separate class of convergence mechanisms that need to be systematically integrated into the analysis of convergence in national eco-economic policies. While countries can implement domestic political measures to reduce greenhouse gas emissions and adapt to climate change, their actions may be limited or insufficient if other countries do not join similar efforts. This can lead to inefficiency and an inability to achieve global environmental goals. Therefore, the problem statement includes the absence of unified standards, disparities in technology and infrastructure development, as well as the complexity of interaction between national policies and international agreements. Understanding these issues will help identify key challenges and pathways to achieving convergence of national environmental-economic policies. Convergence of national environmental and economic policies necessitates research into the nature and causes of inequality between countries regarding the level of development of environmental technologies, energy efficiency, and infrastructure. A generalized typology of policy convergence mechanisms has been proposed, which includes harmonization, imposition, diffusion, and regulatory competition, playing a significant role in achieving ecologic-economic policy convergence and creating a favorable environment for sustainable development and economic growth.

Impact of China’s Local Government Competition and Environmental Regulation on Total Factor Productivity

In the transition of China’s economy toward high-quality development, it will be increasingly important to coordinate the relationship between local government competition, environmental regulation, and the transformation of the economic growth mode. To explore the impact of local government competition and environmental regulation on total factor productivity (TFP), in this study empirical analysis models were established using panel data of 30 provinces in China from 2001 to 2017. Local government competition was measured from the perspectives of foreign direct investment (FDI), fiscal expenditure, and tax. The results show that local government competition has a positive impact on the improvement in TFP. Taking environmental regulation into consideration, the impact of local government competition on TFP is weakened. Furthermore, under the current intensity of environmental regulation, local government fiscal expenditure competition and tax competition both lead to improvement in TFP, while FDI competition has the opposite effect. This paper explores the heterogeneity of the impact of local government competition and environmental regulation on TFP under different local government competition levels. Under the influence of environmental regulations, local government FDI competition has a negative impact on the improvement in TFP, particularly in “low” FDI competition areas. Local government fiscal expenditure competition has a positive impact on the improvement in TFP, particularly in “low” fiscal expenditure competition areas. The current level of local government tax competition has a negative impact on the improvement in TFP in “high” tax competition areas, whereas it has a positive impact on the improvement in TFP in “low” tax competition areas.

Trends and Prospects of Development in the Modern System of International Competition Regulation

International regulation of competition seems necessary in the context of globalization and internationalization of economic relations and, as a result, the emergence of transnational corporations (TNCs) that go to the supranational level. Due to the imperfection of national legislation in countries that have only recently embarked on the path of a market economic system, the creation of an effective international competition regulation system should contribute to the implementation of the principles and norms of competitive relations that are mandatory or recommendatory. The purpose of the study is to identify the main problems in the modern international system of competition regulation, as well as to identify problems and ways to improve the system of regulation of competitive relations in Russia.

Constitutional Pluralism, Regulatory Competition and Transnational Governance Failures

Constitutional Pluralism, Regulatory Competition and Transnational Governance Failures

Techno-economic analysis on Mobile Network Sharing contribution to social welfare at 4G-5G area in Hungary

Telecommunication sector faces to parallel investments into both fixed and mobile (5G) networks, however return on investments lag behind profit expectations. Co-investment, like mobile network sharing is a cost efficiency enabler that may accelerate price decrease, may allow earlier, higher coverage and may improve capacity and quality parameters, like download speed, therefore altogether contributes to social welfare increase. The purpose of this paper to assess the Hungarian mobile network sharing that not cleared by the competition regulator, however has been placed in unchanged form for 8 years. The research question is to assess what is the connection between mobile network sharing and social welfare improvement at 4G - 5G mobile broadband rollout. The finding is that, majority of network sharing procompetitive effects allowing benefits, but anticompetitive effects not causing marked distortion. Affordable connectivity prices for information society roots in operators’ cost efficiency, however further research required to assess proper level of efficiency gains pass through to customers and appropriate level of access pricing to shared infrastructure for other rival operators in Hungary. Mobile Network Sharing’s benefits may outweigh potential drawbacks, but due to lack of regulatory clearance, 5G rollout launched without sharing, causing social welfare loss. The originality of the empirical research is despite network sharing not cleared, procompetitive advantages may outweigh anticompetitive ones.

«…Создадим новую игрушку для советской детворы»: о советских игрушках 1940-х гг. На архивных материалах Горьковской области

The article addresses the problem of providing Soviet children with toys and toys production in the USSR in the 1940s. On the basis of modern historiographical material, situation in the “toy” industry of the 1940s is reflected. When presenting the material, a large number of interesting and valuable examples is given, as well as fragments from memoirs of the “children of war.” All these materials mention that toys of the difficult 1940s were mostly homemade. There was an acute shortage of factory-made toys and there were problems with their quality and high cost. Throughout the 1940s (and even in the wartime), Soviet leadership attempted repeatedly to solve these problems. Lack of toys for Soviet children was recognized by the authorities as a problem demanding urgent solution. Drawing on unique archival material of the Gorky region, which is being introduced into scientific use, the article narrates of the competition organized in 1947-48 by the Scientific Research Institute of Toys and aimed at development of new samples of toys and games, improvement of their quality, and launch of their mass production. According to the typology of toys cited in the competition regulations, there were 16 categories of toys for children of all ages, ranging from dolls and balls to a variety of construction kits, cardboard games, and educational materials. The main criteria were complete safety, possibility of mass and, preferably, inexpensive production from local materials, and compliance with educational tasks set by the state. Soviet citizens, enterprises and artels, children’s institutions were invited to participate in the competition; there were prizes amounting to 120,000 rubles or more. Given the realities of 1947, this seems an important marker of the state’s attention to organization of children’s leisure and education, which was deemed an integral component of combatting child homelessness and neglect. The article identifies main trends in solving the problem of toy shortage in the second half of the 1940s. It is to complete the picture of everyday life and consequences of the Great Patriotic War.

Innovative factors in the formation of the competitive environment of the banking services market in the context of sanctions: legal aspect

The purpose of this study was to conduct a comprehensive analysis of the legal regulation of banking competition in the context of sanctions. Methods: in the course of the study, a systematic method was used, which made it possible to identify trends in the development of competitive mechanisms in the banking services market in the context of sanctions. The application of the analytical method contributed to a comprehensive study of foreign experience of legal regulation. Results: a legal analysis of the competitive environment prevailing in the banking services market under sanctions was carried out. A characteristic feature of modern economic processes and legal relations is the introduction of innovative technologies that radically change the business models of the functioning of business entities. Innovations also affected the financial sector of the economy, in particular, the banking services market. In the context of the crisis of the banking system, companies began to appear that provide services similar to banking, based on advanced information technologies and software solutions. Such companies have become participants in competitive relations in the banking services market, being a serious alternative to credit institutions with a standard set of banking services. The novelty of the research is that a comprehensive analysis of the legal mechanisms of the competitive functioning of the banking market in the context of sanctions has been carried out. Practical significance: the research materials can be used in the preparation of an analysis of the competitive environment of the banking services market and the identification of problems of the legal protection of banking competition.