Competition policy in dynamic markets

Competition and antitrust policies have been based on a scholarly tradition focusing on static models and static analyses of industrial organization. However, recent developments in the industrial organization literature have provided significant advances moving beyond the traditional static models and the pre-occupation with price competition. In particular, the field has now developed to consider the organization of industries in a dynamic cont ext. These new approaches are dynamic in the sense that performance is rela ted to variations in the products available to consumers, as well as variat ions in firm competencies, ranking, growth, entry and exit. The development of the industrial organization literature also incorporates models of indu stry and market evolution. The purpose of this paper is to provide a framew ork linking what is known in the industrial organization literature on the dynamics and evolution of markets to one of the major policy instruments - competition policy. This framework provides a basis for understanding the c ontributions of the contents of the Special Issue devoted to Competition Po licy in Dynamic Markets. (C) 2001 Elsevier Science B.V. All rights reserved .