oa Comparative and International Law Journal of Southern Africa - Redefining the objectives of South African competition law

Volume 34, Issue 3
  • ISSN : 0010-4051



Both economic and legal principles shape and underpin competition law, thus complicating the evaluation of the outcomes of enacted competition law. A more manageable test of its efficacy and, more specifically, that of the regulatory authorities, would, perhaps, be to focus on whether there has been a discernible increase in the intensity of competition in the South African economy since the Act's promulgation. In this regard one can, on the one hand, take some comfort from the remarks of Michael Porter, the internationally respected Harvard University professor, on the discernible benefits of competition who said: ... countries where the intensity of competition is rising showed by far the greatest improvement in GDP per capita. However, working on the assumption that fluctuations of market shares is a good indicator of the level of rivalry in a particular market, one's expectations regarding the state of competition in South Africa should not be too optimistic. Research has shown that the mark-up of final prices over unit labour cost in South African production may be up to five times higher than in the United States. The reason for such a large mark-up over unit cost can only be attributable to insufficient competitive pressure in South African output markets.

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