The Pros and Cons of Fighting Inflation with Competition Policy
Our annual international Pros and Cons conference, where academics and practitioners meet and discuss critical aspects of competition law and policy will take place in Stockholm on Monday 8 May, 2023. Previous conferences, widely attended by enforcers, lawyers and consultants, have been greatly appreciated and we are certain that this year’s event will be no exception.
The theme of the 21st edition of the Pros and Cons conference in 2023 is motivated by the current economic crises where inflation have reached levels not seen in decades. The situation is critical for many as central banks have tightened monetary policy. Living costs for households have risen dramatically and led to calls for political action in many countries, including market intervention. Does weak competition bear part of the blame for the situation? Can competition policy be part of the solution to the crises?
Keynote address introduces the theme, which is followed by three panels.
Does weak competition bear any responsibility for the souring prices? Is better competition a useful tool in fighting inflation, and if so, how can that be achieved in the midst of an economic crises? To what extent does weak competition render monetary policy less effective?
Although the recent inflationary push is hardly the result of novel distortions of competition, the role of competition, both as a cause and as a solution, has been stressed by a range of stakeholders. In the panel, we will meet both macro-oriented economists, represented by the Deputy Governor of the Swedish Central Bank, and micro-oriented economists from competition enforcement agencies.
Can price caps or other forms of price regulation be adopted to fight inflation? Can voluntary agreements among competing firms to refrain from price increases achieve the same objective? What are the most recent experiences from policy initiatives to curb inflation and can such moves have negative effects on competition? What does the post-WWII economic history teach us?
Politicians are today under pressure to act to mitigate the rising living costs for households, including, for instance, market interventions and income support to households. Price caps or other forms of price regulation are common examples, to name but a few. Different countries have chosen different paths and we may draw lessons and compare experiences.
How does the competitive behaviour of firms change with a surge in inflation? Does reduced price transparency, an effect of frequently increasing prices, make consumers less demanding and more prone to accept higher prices? Do businesses pass on more than is motivated by higher costs? What should enforcers beware of in a high-inflation environment?
The possible weakening effect of inflation on competition is also a centrepiece in the recent debate on greedflation, or price gouging. In a high-inflation environment, the argument goes, price comparison is trickier, especially for consumers, and price competition between firms may be reduced. In the panel, different perspectives of this debate is put forward, together with the question of what enforcers and policymakers should do about it, if anything at all.
|8.30||Registration and Coffee|
|9.00||Welcome address by Rikard Jermsten, Director General, Swedish Competition Authority|
Keynote address: Can competition policy help fight inflation?
Lars Magnusson, Professor of Economic History, Uppsala University
Richard Friberg, Professor of Economics, Stockholm School of Economics
Panel 1: Does weak competition lead to more inflation?
Martin Flodén, Deputy Governor, The Riksbank
Páll Gunnar Pálsson, Director General, Icelandic Competition Authority
Panel 2: Politicians consider new interventions to curb inflation – is competition at risk?
Ana Sofia Rodrigues, Chief Economist, Portuguese Competition Authority
Pierre Régibeau, Chief Competition Economist, DG Competition
Ioannis Lianos, President, Hellenic Competition Authority
Moderator: Sten Nyberg, Professor of Economics, Stockholm University
Panel 3: Does inflation weaken competition?
Antonio Buttà, Chief Economist, Italian Competition Authority
Linda Gratz, Director, E.CA Economics
The conference venue is World Trade Center (Meeting room: New York), Klarabergsviadukten 70, Stockholm. See map
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The conference is free of charge. The registration for in-person participation is closed.
The conference will be broadcasted live. The link to the livestream is published on this webpage (no pre-registration is needed for the webcast).
The information on this website will continuously be updated.