Schumpeterian competition and its policy implications : the Latin American case

This paper discusses the peculiar role of competition policy in the process of economic reform. It points out that antitrust can render two important services to an open developing economy: a set of rules that guides the competititon process toward efficiency and fairness and a mechanism that may protect the national interest from anti-competitive practices originated elsewhere in the world economy. the paper recapitulates the Schumpeterian approach to competition and indicates the core of the policy agenda derived from this approach, in which antitrust authority is compelled to act as the regulator of last resort in the economy. It also presents the domestic challenges faced by the newly-created Latin American and Caribbean antitrust agencies and deals with cross border issues at bilateral, sub-regional hemispheric and multilateral levels. Finally, it highlights that two initial steps are necessary to regulate the newly open economy: the research on market contestability and the improvement of sub-regional antitrust mechanisms