The rise of powerful global multinationals has led to higher industrial concentration since early 2000s, which leads to higher entry barrier, lower competition and efficiency.
As China ascends to the second largest economy in the world, the size and capability of Chinese corporations have grown significantly, and they have emerged as important market players globally. This puts further pressure on competition policies globally. On the one hand, each country has domestic competition policies to prevent too strong a market concentration, and on the other hand, nation states may have incentive to see their corporations to be competitive in world market and reap economic rents globally.
Deep thinking and research on this issue are critical at this juncture. From China's perspective, it is important that a path is identified to allow Chinese corporations to share the rents in global market and to contribute to the expansion of global markets.
We take the questions to real data and examine empirically and rigorously the performance of Chinese corporations over time in various industries globally. We analyze both the strategic interaction between nations in designing various competition policies, and the optimal policies that will deliver the best welfare outcome for consumers in various countries.
Image: Mike Behnken/Flickr