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Measuring competition in the Netherlands

Author

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  • Harold Creusen
  • Bert Minne
  • Henry van der Wiel

Abstract

In the 1990s policy makers took various measures to stimulate competition. This memorandum investigates the question in which direction competition in the Dutch market sector has changed. Four competition indicators are used. These indicators are derived from a database of 87 000 firms as well as from the input-output tables of the National Accounts. Data availability limits the analysis to the period 1993-2001. Remarkably, the indicators do not suggest that competition increased economy-wide. All show that competition changes have been rather small in many industries, but a considerable number of industries experience a sharp rise or strong fall in competition. Nonetheless, the indicators frequently contradict each other on the change in competition at the industry level. These differences can partly be traced back to differences in their economic concepts. In theory, the indicators can differ, because they respond differently to a reallocation of output from inefficient to efficient firms. Econometric and statistical tests provide some but mainly insignificant evidence to support this hypothesis.

Suggested Citation

  • Harold Creusen & Bert Minne & Henry van der Wiel, 2006. "Measuring competition in the Netherlands," CPB Memorandum 163, CPB Netherlands Bureau for Economic Policy Analysis.
    • Handle: RePEc:cpb:memodm:163
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    References listed on IDEAS

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    Cited by:

    1. Gagnepain, Philippe & Ivaldi, Marc, 2016. "An Evaluation of the Degree of Competition in the French Life Insurance Industry," TSE Working Papers 16-697, Toulouse School of Economics (TSE).
    2. Polder, Michael & Veldhuizen, Erik & Bergen, Dirk van den & Pijll, Eugène van der, 2009. "Micro and macro indicators of competition: comparison and relation with productivity change," MPRA Paper 18898, University Library of Munich, Germany.

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    More about this item

    JEL classification:

    • D40 - Microeconomics - - Market Structure, Pricing, and Design - - - General
    • L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General

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