Market Economics, Competition and Finance
Any change in policy or regulation that might have an impact on industries, companies or any other economic activity needs to take the prevailing economics into account. There are different levels at which economics are important. Firstly, there is the macro-economic level, which deals with how the economy as a whole operates in terms of Gross Domestic Product (GDP), inflation or deflation rates, levels of employment rates, etc. This level links into fiscal policy areas which deal with government policies on, for example, taxation, spending and borrowing.
The next level is the micro-economic level, which deals with the individual units (such as companies and households) that make up the economy. It covers how markets operate, how prices are determined (relative pricing), the income and output of individual firms and the types of competitive forces which prevail in a given industry sector. Another aspect of economics which is particularly relevant to policy making relates to efficiency, which involves an understanding of costs and benefits, and application of marginal analysis.
All of these aspects must be borne in mind when trying to determine the most appropriate policy to put in place. This is particularly important where a policy change is likely to affect the cost of inputs, the price of goods and the overall competitive position of firms and, potentially, the wider competitiveness of the EU as a whole. This is why, since 2010, the European Commission has integrated the assessment of impacts on industrial competitiveness into the overall analyses of economic, environmental and social impacts of new policy proposals.
Assessing sectoral competitiveness requires an integrated approach that takes into account the economic, social, and environmental impacts of a policy intervention and, as such, an analysis of impacts should always clearly identify the beneficiaries and likely trade-offs associated with any policy change. RPA has completed a number of these analyses and is highly skilled in the collection and analysis of the data required for economic and competitiveness analysis, as well the political, economic and technological factors that also impact on competitiveness in such analysis.
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