A conceptual framework to identify dynamic efficiency. (2nd September 2015)

• Record Type: Journal Article
• Authors: Kathuria, Vikas
• Is Part Of: European competition journal. Volume 11:Number 2/3(2015:Aug.)
• Page Start: 319
• Page End: 339
• Publication Date: 2015-09-02
• Subjects: efficiency -- static efficiency -- productive efficiency -- dynamic efficiency -- innovation; Antitrust law -- European Union countries -- Periodicals; Competition, Unfair -- European Union countries -- Periodicals; Restraint of trade -- European Union countries -- Periodicals; 343.40721
• DOI: 10.1080/17441056.2015.1060006
• Languages: English
• ISSNs: 1744-1056

Abstract

Abstract : Even though dynamic efficiency has a great potential to bring social welfare, it was not until recently that dynamic efficiency started impressing competition authorities in deciding the net effect of mergers, agreements and abuse of dominance practices on competition. The problem, however, is that there is a general confusion regarding the difference between static and dynamic efficiency. Also, there is no unanimously accepted holistic definition of dynamic efficiency. For the correct application of competition law it is, therefore, essential that competition law practitioners, both lawyers and economists, are able to correctly identify dynamic efficiency. This paper, after analysing several definitions of dynamic efficiency, categorizes the definitions into four approaches and develops a conceptual framework. After ascertaining the limitations of each approach, a holistic definition is suggested.