On trust in markets

It was a great pleasure to spend two, sunny, late November days in Melbourne this year (2019) discussing the future of regulatory policy with Australian

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Materials from Conferences

Remedies in financial services markets

Delivered as part of ‘Regulation of markets and networks in the UK: the state of play in a period of economic and political insecurity’, Annual Westminster Conference 2015

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buildings with glass windows

The political economy of markets

The word market is widely used in contemporary economic and political discourse, but usually without any clear sense of what it means or is meant to refer to. In a literal sense, people do not know what they are talking about. The first part of the essay therefore examines the question: what is a market?
The answer is that a market is an economic institution, i.e. a set/system of rules that structures, regulates or governs a particular set of activities involving exchange of goods and services. It encompasses both the system of rules and the activities governed by them and it serves a specific, particular purpose or function, which is to reduce the costs of exchange transactions

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airline flight schedules on flat screen televisions

Market definition and market power in the airport sector: competition from outside the relevant market

The purpose of this note is to draw attention to a generally neglected aspect of assessing market power in the supply of airport services. It develops a point made en passant in a paper written by the current author and George Yarrow for the UK CAA in 20101. The paper stressed that, although it was the standard practice in competition assessments to define substitution possibilities from within a defined market, sources of constraint on market power also arose from substitutable products defined to lie outside the relevant market and that it was the cumulative effect of all the substitution possibilities that determined the own-price elasticity of demand for a product or service.

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