OECD GLOBAL FORUM ON COMPETITION

Promoting Competition—Protecting Human Rights:

A Helicopter View

Jean-Pierre Chauffour, World Bank Group

December 1, 2016

Domestic vs foreign competition • Domestic competition

• Extent of market dominance, Effectiveness of anti-monopoly policy

• Competition in professional services, Competition in public services

• Cost required to start a business, Time required to start a business

• Bankruptcy proceedings costs, Strength of insolvency framework

• Total tax rate, Distortive effect of taxes and subsidies

• Foreign competition • Prevalence of non-tariff barriers (import bans, import quotas, etc.)

• Trade tariffs

• Complexity of tariffs schedules

• Burden of customs and border-related procedures

Source: World Economic Forum (WEF)

Domestic vs foreign competition

Source: WEF, all available countries

R² = 0.5704

2.5

3

3.5

4

4.5

5

5.5

6

6.5

2.5 3 3.5 4 4.5 5 5.5 6

Fo

reig

n C

om

pet

itio

n

Domestic competition

High-income countries

Upper-middle-income economies

Lower-middle-income economies

Low-income economies

Negative vs positive rights

• Three generations of rights: • Liberté: negative rights (freedoms from, covenant on CPRs)

• Egalité: Positive rights (rights to, covenant on ESCRs)

• Fraternité: collective rights (e.g., Right to development)

• Is it as clear cut? • Negative rights but positive (expensive) duties

• Essence of negative rights: no claims or entitlement, end-independent

• (Negative) right not to starve (e.g. freedom from hunger)

• Right to development: (negative) right not to collaborate in an unjust international economic order

• Negative rights are orthogonal (unlike positive rights)

Negative vs positive rights

Source: Cato institute and IMF

R² = 0.0387

4.5

5

5.5

6

6.5

7

7.5

8

8.5

9

10 20 30 40 50 60

Eco

no

mic

fre

edom

in

dex

Government expenditure (in percent of GDP)

Civil and political rights vs competition

Source: Freedom house and WEF

R² = 0.2297

10

20

30

40

50

60

70

80

90

100

2 2.5 3 3.5 4 4.5 5 5.5 6 6.5

Civ

il a

nd

po

liti

cal

righ

ts

Foreign competition

Personal freedom vs competition

Source: Cato institute and WEF

R² = 0.3322

3.5

4.5

5.5

6.5

7.5

8.5

9.5

2 2.5 3 3.5 4 4.5 5 5.5 6

Per

son

al

free

dom

Foreign competition

GDP per capita vs competition

Source: World Bank and WEF

R² = 0.4623

2

2.5

3

3.5

4

4.5

5

3 3.5 4 4.5 5 5.5 6

Lo

g G

DP

per

cap

ita

Competition

Human development vs competition

Source: UNDP and WEF

R² = 0.3149

0.35

0.45

0.55

0.65

0.75

0.85

0.95

2.5 3 3.5 4 4.5 5 5.5 6

Hu

ma

n d

evel

op

men

t in

dex

Competition

Gender inequality vs competition

Source: UNDP and WEF

R² = 0.3034

0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

2.5 3 3.5 4 4.5 5 5.5 6

Gen

der

In

equ

ali

ty I

nd

ex

Competition

Child labor vs competition

Source: UNICEF and WEF

R² = 0.0014

0

5

10

15

20

25

30

35

40

45

50

2.5 3 3.5 4 4.5 5 5.5

Ch

ild

lab

or

Competition

Workers’ protection vs competition

Source: ILO and WEF

R² = 0.006

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

2.5 3 3.5 4 4.5 5 5.5 6

Wo

rker

pro

tect

ion

Competition

Minimum wage vs competition

Source: World Bank (Doing Business) and WEF

R² = 0.1735

0

0.5

1

1.5

2

2.5

3

3.5

4

2.5 3 3.5 4 4.5 5 5.5 6

Lo

g m

inim

um

wag

e

Competition

Minimum wage (OECD) vs competition

Source: OECD and WEF

R² = 0.3641

0

5000

10000

15000

20000

25000

4 4.5 5 5.5 6

An

nu

al

min

imu

m w

ag

e (P

PP

)

Competition

Country inequality vs competition

Source: World Bank, WEF

R² = 0.0008 -45

-35

-25

-15

-5

5

15

-15 -10 -5 0 5 10 15 20 25 30

Gin

i in

dex

va

riati

on

(in

%)

(19

95

-2015)

Competition (change in % 1995-2015)

Higher inequality

Higher competition

Lower inequality

Lower competition

Higher inequality

Lower competition

Lower inequality

Higher competition

Global inequality: Change in real income by percentiles 1988-2008

Source: Milanovic, Branco (2012). Global Inequality by the Numbers, PRWP#6259, World Bank

-10

0

10

20

30

40

50

60

70

80

90

5 15 25 35 45 55 65 75 85 95

Rea

l in

crea

se i

n i

nco

me

Percentile of global income distribution

Elephant chart

-10

0

10

20

30

40

50

60

70

80

90

5 15 25 35 45 55 65 75 85 95

Rea

l in

crea

se i

n i

nco

me

Percentile of global income distribution

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