In particular, the research will address three recent developments relevant for competition policy, which are closely related. First, there has been a dramatic change in the availability, affordability and diffusion of new forms of information technology, such as the Internet. These new technologies have had a significant impact on both the structure of Markets and the issues facing regulators in many industries. Changes in market structure and regulation have in turn raised a host of new issues for competition policy, in particular because of important market failures and endogeneity of market structure. The new technology has also allowed information to diffuse more rapidly, and this has raised the prospect of easier coordination between firms in industry.

These issues can, of course, arise in national markets, but they have also made the international dimensions of competition policy much more important. Markets characterized by strong network effects and standards (such as software) are likely to see the emergence of a single dominant producer, and this producer is likely to dominate global as well as national markets. The internationalization of competition policy is not limited to markets where information technology is important. Falling barriers to trade have accelerated the pace of international economic integration, lowering the barriers between national markets and introducing an international dimension to competition policy even in ‘old economy’ industries. Competition policy is more international because markets are now more integrated. International economic integration thus poses a second important challenge for competition policy.

Third, and partly as a consequence, a number of governments have enacted new competition law and institutions and many have become more pro-active in the implementation of their statute. Competition policy has gained a higher profile, but with this higher profile has come a growing concern about the politics of competition policy.