This presentation by Patricia BASCUNANA-AMBROS, OECD Competition Division, was made during the discussion “Methodologies to Measure Market Competition” held at the 135th meeting of the OECD Competition Committee on 11 June 2021. More papers and presentations on the topic can be found out at oe.cd/mmmc.

1. COMPETITION COMMITTEE
METHODOLOGIES TO MEASURE
MARKET COMPETITION
Presentation by the Secretariat
11 June 2021
Patricia Bascunana-Ambros
Competition Division

2. 1
• To apply competition law in markets affected by
mergers and potential abuse of dominance –
competition enforcement
2
• To assess whether pro-competitive intervention is
needed and whether such intervention is likely to
be net beneficial – competition advocacy
3
• To assess ex-post the effectiveness of competition
policy of an authority
Why measure competition? At least
three broad reasons

3. Structural – HHI, other concentration indices (CRs)
and entry and exit condition measures
Dynamic – entry rates, churn, volatility of market
shares concentration and rank
Performance – mark-ups, profit measures, Boone,
Panzar-Rosse
Survey measures – consumer and business
perception of competition
A plurality of measures of competition

4. The need for a
plurality of
competition
measures
The level of data
aggregation
The need to take
account of the
dynamic aspects of
competitive rivalry
The importance of
imports, exports
and multinational
firms
The purpose for
measuring market
competition
Key issues to consider when measuring
competition

5. • Given data and methodological limitations when measuring the intensity of
competition the analysis of such measures cannot be interpreted as
providing a definite set of conclusions.
• However, such analysis can provide useful information for identifying
where competition authorities want to do further research / or be more
vigilant.
Potential areas for further improvement:
• Conceptualisation of competition as a dynamic process
• Level of data aggregation: anti-trust markets vs. SIC industry codes
• Scoping of markets – not just domestic markets – imports /exports and the
role of multinational firms
• Partial ownership
• Mark-up estimation
Looking to the future