Look around you. You are most likely sitting comfortably on a chair or sofa, in a heated or cooled room, surrounded by your comfort technology – from your smart water-resistant mobile phone, to your new extra thin laptop with its long-life battery. As you read this introduction, you might be interrupted by notices on your phone, video chats from friends and reminders from your digital assistant. You might then step out and go to your favourite shop, where choice is abundant, to buy reasonably priced food and goods. You might later meet friends in your favourite hangout where the service is excellent. Maybe travel around town in your reasonably priced car or ride sharing service, watch a movie, or just explore the market.
Your environment is characterized by ample choice, smiling service providers and reasonably priced goods. Sure, things can always improve. No doubt. But pause for a second and appreciate one of the key drivers that make this environment possible – the competitive process.
It is the rivalry between businesses and traders that delivers the abundance of choice, the lower prices, the increased innovation, and the better quality of goods and services. It is this process of competition which enables your money to go the extra step: to buy more for less. A process which has generated much of the prosperity of the western world. Without it, you would most likely have been sitting in a somewhat bare room on an uncomfortable chair that was purchased from an unpleasant seller at an inflated price. Your money would buy you less. Less goods, less services, less quality, and less innovation. Not so rosy.
And so, as a society, we strive to protect the beneficial dynamics of competition as a means to enhance consumer welfare, deliver efficiencies, and encourage innovation.
At times, society has to work hard to maintain the abundance that comes with competition. While competition benefits us, the consumers, it makes the life of producers, sellers and service providers rather difficult. They need to improve to stay in business. They need to invest in new products, new technologies, new processes. They need to offer us goods and services at an attractive price. If they fail to remain competitive, they may find themselves being pushed out of the market. And so, at times, these sellers and service providers may look for ways to dampen the competitive process. Think, for example, of price-fixing cartels or market sharing agreements which result in us paying more and getting less. Think of powerful companies that might abuse their power to distort the market, for example, by stopping their customer from buying from other companies. Or maybe large merger transactions between two giant companies that could leave us dealing with a single dominant seller that benefits from concentrated power.
Our antitrust and competition laws are designed to address these risks, remedy possible market failures, and safeguard consumer welfare. Our competition agencies and courts are tasked with enforcing the law. As they do so, they face the challenge of correctly identifying what amounts to an anti-competitive activity, and curtailing it to ensure dynamic and competitive markets.
This book is about these market dynamics, their promises and limitations. It is about the laws that are used to safeguard the process of competition, and the way they are enforced. About the delicate and challenging relationship between a free market economy and government intervention. It is about the fascinating forces of competition that influence your wealth and shape our modern society.
Using dozens of vivid examples to show how society overprescribed competition as a solution and when unbridled rivalry hurts consumers, kills entrepreneurship, and increases economic inequality, two free-market thinkers diagnose the sickness caused by competition overdose and provide remedies that will promote sustainable growth and progress for everyone, not just wealthy shareholders and those at the top.
Whatever illness our society suffers, competition is the remedy. Do we want better schools for our children? Cheaper prices for everything? More choices in the marketplace? The answer is always: Increase competition.
Yet, many of us are unhappy with the results. We think we’re paying less, but we’re getting much less. Our food has undeclared additives (or worse), our drinking water contains toxic chemicals, our hotel bills reveal surprise additions, our kids’ schools are failing, our activities are tracked so that advertisers can target us with relentless promotions. All will be cured, we are told, by increasing the competitive pressure and defanging the bloated regulatory state.
In a captivating exposé, Maurice E. Stucke and Ariel Ezrachi show how we are falling prey to greed, chicanery, and cronyism. Refuting the almost religious belief in rivalry as the vehicle for prosperity, the authors identify the powerful corporations, lobbyists, and lawmakers responsible for pushing this toxic competition—and argue instead for a healthier, even nobler, form of competition.
Competition Overdose diagnoses the disease—and provides a cure for it.
The book was listed as one of Inc. Magazine top business books you need to read in 2020 and one of Publishers Weekly Top 10 Business & Economics books for Spring 2020.
