This presentation by Catalina Medel Lucas, Professor (University of Chile) was made during the discussion “Competition & Poverty” held for competition authorities officials on 28 September 2023. More materials on the topic can be found at https://www.oecd.org/competition/latinamerica. This presentation was uploaded with the author’s consent.

1. MARKET STUDIES, COMPETITION
AND POVERTY
Catalina Medel
Researcher Centro de Regulación y
Competencia Universidad de Chile

2. OUTLINE
• Poverty as a prism for competition
• Enforcement is not the only way
• Market studies are a powerful tool for authorities
• Information for consumers (tackling asymmetries)
• Looking forward
• And does it work? The Chilean case
• Public procurement
• GLP
• Final ideas

3. POVERTY AS A NECESSARY
PRISM FOR COMPETITION
• Competition can help and contribute
to face poverty
• If we assume that competition policies
address consumer welfare, then
poverty should also be considered as
an ingredient of such goals
• Countries are also dealing with limited
resources, we have to open the paths
to tackle the issue: we have to act
creatively
• We have to integrate new tools;
enforcement and advocay are not
enough to challenge poverty

4. ENFORCEMENT IS NOT THE ONLY WAY
• Enforcement is expensive, requires a lot of energy from competition authorities, and,
although needed, can create tense relationships between actors in a market
• Market studies are a valuable tool for any competition authority (and in general to any
regulatory agency or public authority)
• Thus, market studies are a flexible instrument that enables authorities to study in deep
markets that could have market failures, but where companies are acting according to
the law. There is no breach of the competition law, but there are still regulatory and
antitrust problems to be solved
• Market studies also allow competition authorities to understand how are consumers
behaving, and understand the relationship between consumers and firms

5. INFORMATION FOR
CONSUMERS (1)
• Market studies are not just an
advocacy tool (they can aim at
advocacy, but they deal with other
issues too)
• They allow authorities to address
information asymmetries between
companies and consumers –
specially if the results are advertised
to the consumers
• The case of the School Textbooks

6. INFORMATION FOR CONSUMERS (2)
25-09-23 23:41
Textos escolares: Editorial congeló sus precios en medio de estudio de la FNE - Cooperativa.cl
Textos escolares: Editorial congeló sus precios en medio de
estudio de la FNE
Publicado: Domingo, 27 de Enero de 2019 a las 12:03hrs. | Periodista Digital: Cooperativa.cl
La editorial SM estancó sus valores para todos sus libros del año en curso tras el comienzo de la investigación.
El ente antimonopolio estima una "alta concentración" en este mercado.
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EL COMENTARISTA OPINA
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Pronóstico :

7. LOOKING FORWARD
• Market reforms: Public procurement case
• Promotes competition.
• Cooperation between agencies and
market participants:
• Transparency
• Better regulation
• Recognises that a competitive market should
be an aim for firms and authorities

8. CHILE (1)
• The competition agency, Fiscalía Nacional
Económica, did not had, until the last reform,
authority to carry out market studies
• However, the Fiscalía did some studies through
advocacy powers given by the law (DL 211)
• Emulating the UK CMA´s power structure and
institutional design, the Fiscalía has now powers
to carry out market studies, to require
information to the market participants, and to
propose regulatory changes to government
• What does this mean?
• Current studies: accommodation platforms

9. CHILE (2)

10. PUBLIC PROCUREMENT
• The purchase of goods and services by the government has a
direct effect over poverty, like providing health and housing.
• Fiscalía proposed a structural change over public procurement:
changing the institutional design and forcing authorities to plan
ahead its procurement activities
• It is hoped to save between US$290 MM and US$855 MM
• In August the Congress passed a new law on public procurement
tackling the issues identified by the Fiscalía and tacking the
recommendations made by the agency
• The market study done by the Fiscalía introduced the first relevant
change in public purchases since the original public purchases law
was passed

11. GLP
• But market studies should be intensly studied and
understood by any agency involved
• Market studies are an important input for regulatory
reform and innovation, however a market study is not -in
itself- a clear and direct regulation
• Recommendations made by the Fiscalía in the GLP case
were criticised by the market, specially when a pilot
program from the government did not deliver the results
they aimed at
• However, changes to the market are being discussed in
the Congress, and the recommendations of the Fiscalía
are being heared

12. FINAL IDEAS
• Poverty is a prism for competition: School textbooks
and GLP affect directly poorer people
• Enforcement and advocacy are not the only way; they
are essential to competition policy, BUT we can (need)
look for other paths
• Market studies are a powerful tool for authorities, not
only because it allows authorities to deeply scrutinize
markets, but because it allows to develp a coordination
between the stakeholders that allows to make
regulatory decisions
• Market studies also contribut to the consumer welfare
by giving relevant information in order to make
decisions

13. cmedel@derecho.uchile.cl
THANK YOU!