Toward a fairer society: inequality and competition policy in developing Asia

Abstract

Rising inequality poses a serious threat to sustained growth and poverty reduction in developing Asia. Many countries in the region have adopted competition policy—also known as antitrust—to promote economic welfare by protecting competitive processes, as well as in consideration of public interests, including social equity. This paper uses the Philippine experience to illustrate the conceptual and institutional issues in operationalising competition policy for development. Competition policy in the Philippines has historical roots in its struggle for economic and social reforms aimed at achieving inclusive development. Properly framing competition policy to stay close to its core guiding principle is key to its effectiveness in contributing to inclusive development. The paper concludes that, in the Philippine context, adhering to consumer welfare standards in competition policy promotes a fairer social outcome (i.e., reduction of income inequality and poverty) while improving economic efficiency.