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Competition across transition economies: an enterprise-level analysis of the main policy and structural determinants
This paper examines the main policy and structural determinants of the
intensity of competition at the enterprise level across transition economies,
presenting new evidence based on an enterprise-level survey and a legal survey
directed to both competition agencies and legal experts in the area of
competition policy. It explores the key variables, at the country and
enterprise level, that affect the variations of the intensity of competition
in domestic markets. At the country level an important finding is that
competition policy and recent changes in its implementation are significantly
and positively correlated with the intensity of competition. This result is
robust to the introduction of other policy-level controls and alternative
specifications of the basic model. Other interesting results at the micro
level include a significant positive relationship between the intensity of
competition, lower barriers to entry and exit, and higher perceived elasticity
of demand. In addition there are robust ownership, size and sectoral effects
but not life-cycle effects.
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