Distorting effects of competition authority’s performance measurement: the case of Russia

Abstract

Purpose – The purpose of this paper is to explain the impact of the incentives of competition authorities concerning antitrust enforcement on the structure of enforcement and understanding of the substantive norms and welfare standards in Russia using case-level evidence. Design/methodology/approach – The study is based on a unique data set of appeals to infringement decisions in 2008-2012. Quantitative and qualitative analyses are applied to derive an understanding of the targets of competition policy in the practice of enforcement. Findings – The analysis reveals that the majority of cases would never be investigated under conventional understanding of the goals of antitrust enforcement. It is also shown that antitrust authorities tend to investigate cases that require less input but result in infringement decisions with lower probability of being annulled and lower cost to proceed. Structure of enforcement is skewed toward cases where harm serves as independent and sufficient evidence of competition law violation. Originality/value – The results show that it is dangerous to motivate authority and public servants based either on number of tasks completed or completeness of tasks when they are heterogeneous in terms of difficulty and where easier ones provide lower positive effects on welfare. Judicial reviews may poorly contribute to performance measurement under a discretionary choice of enforcement targets.