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Objectives and the Optimal Structure of Competition Authorities Revisited

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  • Yannis Katsoulacos

    (Athens University of Economics and Business
    Jianggxi University of Finance and Economics)

  • Vasiliki Bageri

    (Athens University of Economics and Business)

Abstract

This article contributes to the discussion of the implications of different objectives pursued by the competition authorities (CAs) for their optimal structure in terms of whether one or more functions (or activities) should be assigned to them. Different areas of enforcement activity that can be assigned to CAs may differ in the extent to which they contribute to welfare-enhancing or reputation-enhancing objectives. In their recent paper, Avdasheva et al. (Rev Ind Organ 54:251–282, 2019) showed that when the CAs are reputation-maximizing, it may then be optimal to have activities undertaken by specialist authorities, each specializing in one activity. In this article, we generalize the utility function of the CAs, allowing also the welfare impact of the decisions made to influence their utility, and show that if the CAs are welfare maximizers, then all the activities should be undertaken by one generalist authority.

Suggested Citation

  • Yannis Katsoulacos & Vasiliki Bageri, 2022. "Objectives and the Optimal Structure of Competition Authorities Revisited," Journal of Industry, Competition and Trade, Springer, vol. 22(1), pages 69-81, March.
    • Handle: RePEc:kap:jincot:v:22:y:2022:i:1:d:10.1007_s10842-021-00370-8
    DOI: 10.1007/s10842-021-00370-8
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    References listed on IDEAS

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    1. Frederic Jenny & Yannis Katsoulacos (ed.), 2016. "Competition Law Enforcement in the BRICS and in Developing Countries," International Law and Economics, Springer, number 978-3-319-30948-4, January.
    2. S. Avdasheva & S. Golovanova & Y. Katsoulacos, 2019. "Optimal Institutional Structure of Competition Authorities Under Reputation Maximization: A Model and Empirical Evidence from the Case of Russia," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 54(2), pages 251-282, March.
    3. Schinkel, M.P. & Tóth, L. & Tuinstra, J., 2014. "Discretionary Authority and Prioritizing in Government Agencies," CeNDEF Working Papers 14-15, Universiteit van Amsterdam, Center for Nonlinear Dynamics in Economics and Finance.
    4. Frederic Jenny, 2016. "The Institutional Design of Competition Authorities: Debates and Trends," International Law and Economics, in: Frederic Jenny & Yannis Katsoulacos (ed.), Competition Law Enforcement in the BRICS and in Developing Countries, pages 1-57, Springer.
    5. Avinash Dixit, 2002. "# Incentives and Organizations in the Public Sector: An Interpretative Review," Journal of Human Resources, University of Wisconsin Press, vol. 37(4), pages 696-727.
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