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Sean Ennis, Aug 12, 2014
The enactment of a competition law and creation of a competition authority are important elements to ensuring successful operation of economic markets, with businesses vying for the patronage of purchasers through rivalry between their product and service offerings. But the mere existence of an enforced competition authority will not alone set the groundwork of economic competition needed for generating a successful market economy. What is needed is to establish a competition culture, which can be defined as a set of attitudes and beliefs, by the many economic actors that support market outcomes constrained by limits on market power.
The difficulty in establishing a competition culture is not only because of the practical difficulties of enforcing a law-for example, because detecting a violation is difficult or because the number of violations is much higher than the capacity to prosecute them. The challenge is much deeper and more fundamental, lying in standardized forms of interaction and beliefs that may create a culture of ambivalent or hostile attitudes and practices towards competition. In countries that have newly created competition authorities, the challenge of creating a culture in favor of competition can be substantial. While laws may change overnight, traditional behaviors by business operators are unlikely to change with the same speed. Even in countries with a long h…