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The Impact of Competition Policy Enforcement on the Functioning of EU Energy Markets

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  • Tomaso Duso
  • Jo Seldeslachts
  • Florian Szücs

Abstract

We investigate the impact of competition policy enforcement on the functioning of European energy markets while accounting for sectoral regulation. For this purpose, we compile a novel dataset on the European Commission’s (EC) and EU member states’ competition policy decisions in energy markets and combine it with firm- and sector-level data. We find that EC merger policy has a positive and robust impact on (i) the level of competition, (ii) investment and (iii) productivity. This impact, however, only shows up in low-regulated sectors. Other competition policy tools—EC state aid control and anti-trust, as well as all member state policy variables—do not have a uniform effect on energy markets. Our findings are consistent with the idea that the EC’s merger policy actions have been used to overcome obstacles to a well-functioning EU energy sector and may have contributed to the overall development of gas and electricity markets in Europe.

Suggested Citation

  • Tomaso Duso & Jo Seldeslachts & Florian Szücs, 2019. "The Impact of Competition Policy Enforcement on the Functioning of EU Energy Markets," The Energy Journal, , vol. 40(5), pages 97-120, September.
    • Handle: RePEc:sae:enejou:v:40:y:2019:i:5:p:97-120
    DOI: 10.5547/01956574.40.5.tdus
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    More about this item

    Keywords

    Ex-post evaluation competition policy energy markets;

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • L4 - Industrial Organization - - Antitrust Issues and Policies
    • L98 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Government Policy
    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy

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