Why and How the European Union controls dominance Essay

Why and How the European Union controls dominance - turn up ExampleEconomists are involved in researches on the idea of free market with socially optimal allocation. The notion of argument constitutes the central part of stinting theory. Controversies exist among the policy makers on the way challenger contributes in the process of development. One can witness contrasting thoughts about the meaning of contender in the economic history. Among the different forms of disputation, perfect competition has been able to find a place as the specimen model of analysis. During the time of Adam Smith, the concept of competition was popular and viewed as independent rivalry among people. round of the views suggest competition as a tool that will eliminate profits in the considerable run. But perfect competition and monopoly rules the real market conditions. Therefore conditions imposed by imperfect competition and asymmetric information calls for inefficient competitive equilibria (Cook , 2001, p. 4). The different ways in which the authorities of national disposal and the European Union look into markets so that it can work better is regarded as the policy of competition. The good example of the policy of competition has not been string for the low income economies. A wide range of policy measures influences the competition policy. The policy measures include policies that are subjected towards trade, employment and industry. There have been cases where it developed ways that protect the domestic help competition instead of promoting competition between the competitors (Motta, 2004, p. 3). The range behind the policy of competition is to achieve economic welfare and efficiency at the highest level. The European commission joined hands with the authorities of national competition with the aim to find free and fair mode of competition in the European Union. However the aim of the competition policy is to promote competition. If markets are made to work better i t will contribute to affix efficiency and competitiveness of the economy of UK within the angiotensin-converting enzyme market of the European Union. Competition ensures broader choices for the consumer in the markets for goods and service and advancement in technology which promotes gains in dynamic efficiency. The policy of competition will also ensure competition in price between the suppliers. The policy can also investigate complaints on anti-competitive style within markets. This type of behavior can have negative effect on the welfare of the consumer. In the UK and the European Union there are four pillars of the policy of competition. The first pillar i.e. antitrust and cartels involves removal of contracts which looks to restrict competition. The second pillar i.e. liberalization of market works on introducing fresh competition in sectors of monopolistic competition. The policy of competition analyses the state aided measures. This ensures that the measures taken cannot distort the competition in the single market. This concludes the third pillar i.e. state aid control. The forth pillar of the policy of competition investigates mergers and take-overs between upstandings (Bennett, 2010, p. 3). A firm is able to hold a strong foothold in the market if its economic reason provides the firm the opportunity to operate within the market without taking into consideration the reaction of the competitors or the consumers. The European Commission considers the share of the market and some other factors like ability of the competitors and access of the firm to new(a) materials and control on the network of distribution while appraising the economic power of a firm. If the firm is able to hold its dominant arrangement because of its own efficiency it is highly credible. But if the firm maintains its position by exploiting the power of competition, it is bound to be an