We argue that competition is a process, and as such can be described, rather than defined. No parameter of interest to competition assessment should be estimated in isolation without reference to the history of prices and quantities in a market and the strategic interactions of the firms. An alternative to the approach adopted by DG Competition for modelling tacit collusion and dynamic coordination would be to incorporate directly into competition assessment models some reason for history to matter. With a new package of reforms from DG Competition in Brussels, now may be the time for European competition analysis to embrace more fully elements of public choice, law and economics, and game theory. Collectively, they represent non-market economics. Nonmarket economics for the purposes of this article is therefore based on the conception of economics as the science of rational choice and strategic reaction rather than merely the study and analysis of economic markets. Understanding competition law and understanding non-market economics are challenges that go hand in hand.
“The pleasures of the retrospective view; attractive though they are, are not for me—or you—since we always must renew; the habit of re-learning how to see.”World Competition