[Competition in Times of a Pandemic]

Area of Science:

• Economics
• Market Dynamics
• Competition Law

Context:

• The coronavirus pandemic has triggered significant market disruptions, including corporate closures, insolvencies, and reduced startup activity.
• Policies aimed at minimizing personal contact have accelerated digitalization, increasing the importance of digital markets.
• Pre-existing trends of rising market power and concentration in certain economic sectors are exacerbated by the pandemic.

Purpose:

• To analyze the pandemic's impact on market structures and competition.
• To evaluate the long-term implications of digitalization and market concentration.
• To propose economic policy recommendations for maintaining competition.

Summary:

• The pandemic is causing structural market changes, favoring digitalization and increasing market concentration.
• These changes, combined with existing trends, pose risks to competition.
• Policy responses should focus on long-term competition, including merger control, state aid regulation, and promoting competition alongside state shareholdings.

Impact:

• Potential for sustained adverse effects on market competition.
• Increased significance of digital markets and potential for monopolistic practices.
• Need for proactive economic policies to ensure a competitive post-pandemic economy.