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WHEN DO VERTICAL RESTRAINTS HARM COMPETITION? THE ECONOMICS‐BASED APPROACH AND ITS APPLICATION IN THE BATSA CASE
Author(s) -
THERON NICOLA M.,
BOSHOFF WILLEM H.
Publication year - 2011
Publication title -
south african journal of economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.502
H-Index - 31
eISSN - 1813-6982
pISSN - 0038-2280
DOI - 10.1111/j.1813-6982.2011.01271.x
Subject(s) - harm , competition (biology) , vertical restraints , economics , core (optical fiber) , economic analysis , law and economics , public economics , positive economics , industrial organization , political science , microeconomics , law , engineering , classical economics , ecology , telecommunications , biology , incentive
An “effects‐based” or “economics‐based” approach to competition policy requires a theory of harm that causally links a business practice and its allegedly anti‐competitive effects and also weighs anti competitive effects against the pro‐competitive effects of the practice. This implies a shift away from per se prohibitions of certain practices towards case‐by‐case analysis – a move that has been hotly debated, especially in Europe. Using a case study of the recently concluded British American Tobacco case, we study the core features of an effects‐based approach to vertical restraints. We find the approach followed in the British American Tobacco South Africa case generally consistent with an effects‐based analysis, but highlight some limitations.