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Competitive Advantage: Superior Offer Or Unfair Dominance?
Boscheck, Ralf
37/1  (Fall 1994): 132-151

The recent enforcement records of international competition policy authorities reveal a marked increase in antitrust investigations on charges of "abuse of market power" and "restraints to competition." A review of policy discussions surrounding this development indicates that what initially appeared to be a periodic upsurge in regulatory interest in fact reflects a global trend towards more comprehensive and stringent competition controls. In the process, the very ingredients of business-school models for successful, long-term strategies may be, and in some instances have already been, interpreted as illegal monopolization. This apparent distancing between market realities and competition standards requires companies and policy makers to engage in a dialogue on what it takes to attain, sustain, and exploit a competitive advantage and how to assess its consequences for society at large. This article contrasts the dominant business, economic, and legal perspectives on "competitive advantage" in terms of four recent competition policy cases. It formulates key questions with regard to "market definition" and "permissible restraints to trade" that need to be answered before business can efficiently tackle emerging patterns of industrial organization.

 

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