1. Key Factors for a Successful and Effective Competition Agency William E. Kovacic King’s College London ICN AEWG Workshop Botswana, 10 March 2016

2. Rationale for ICN AEWG Botswana Workshop The Remarkable Transformation – From <20 systems in 1990 to about 130 in 2016 – 2016: Approximately 130 systems Earlier: Pass the Law, All Else Falls into Place Today: Quality of Institutions Shapes Results – Nothing easy or automatic about implementation

3. This Morning’s Agenda Effective and Successful Defined Ten Important Characteristics Virtuous Cycle Personal Views only Contact: wkovacic@law.gwu.edu

4. Resources Hyman & Kovacic, Consume or Invest? What Do/Should Regulators Do?, Washington Law Review (forthcoming 2016) Hyman & Kovacic, Institutional Design, Agency Life Cycle, and The Goals of Competition Law, Fordham Law Review (2012) Kovacic & Hyman, Competition Agency Design: What’s on the Menu?, European Competition Journal (2012) Kovacic, Creating a Respected Brand: How Regulatory Agencies Signal Quality, George Mason Law Review (2015)

5. “What Is the Basis for the Grade in This Course?” Effective and Successful Defined Most Generally: Raise Economic Performance Good Decisions to Intervene, Not to Intervene Good Technique: Organization and Operations

6. Role of Experiments and Learning Inevitable Process of Early Testing – Example: US merger review reforms 1976 Consume or Invest Early Decades: Institution Building

7. I. Define Goals Everything Starts With Clear View of Aims – Focus agency’s staff – Stimulate external debate Connect Aims, Programs, Results Manage Expectations – Heroic expectations vs. actual capabilities

8. II. Conscious Plan to Set Priorities and Strategy to Achieve Them Common Model: Agency as Fire Department Ask: What Gives Best Returns to Society? – Portfolio: Balance risks and returns Match Commitments to Capabilities – Who will do it? – What will it cost? – How long will it take? – How will we know it is working?

9. III. Branding Reputation: Smart, Open, Honest, Courageous – Function of process and substantive programs – Impact on external bodies: courts, legislators, ministers, other regulators, businesses, the public Marketing – Reinforcement in all external communications Articles, briefs, reports, speeches – Communications program

10. Communication and Education Is an Agency Effective Only When the Media and Commentators Say It Is? Education and Marketing – Traditional means – New media

11. IV. Problem-Solving vs. Case-Centric Orientation Traditional Focus: Cases and Big Cases – “We’ve been very busy” – Activity is not the same as accomplishment – Take-offs vs. landings – Short term vs. long term Are Cases Important? Of Course – Impact, credibility, capability Emerging View: How Best to Solve Problems?

12. V. The Right Mix of Tools Law Enforcement: The Anchor Tenant Advocacy Research

13. VI. Investments in Capacity Agency Infrastructure “Research and Development” Budget – Data collection and studies External Consultations: Hearings, Workshops Partnerships with “Co-Producers” – Example: Academic research centers

14. VII. Internal Quality Control Aim: Systems to Test Theory and Evidence – Counteract internal confirmation bias Routine Element of Operations – Not merely response to crisis Ethical Safeguards Confidentiality

15. VIII. Build Human Capital Recruitment: Links to Academia Retention: Skills Development Cooperation across Agencies Preservation of Know-How – Electronic data sets – Capital budget: Investments in technology

16. Cooperation With Other Authorities Why Pool Experience? Health Care Analogy – Refine analytical frameworks – Absorb knowhow from applications – Benchmark operations/management – Address common needs: e.g., training – Example: FTC International Fellows Program

17. IX. Assess Performance Relevant Question: Did Programs Improve Economic Performance? Question We Prefer to Answer: What Was the Agency’s Level of Activity?

18. Evaluation: Programs and Processes What Worked and What Did Not Increasing Importance of Assessing – Program outputs – Operations Means: Internal Assessment, Consultation with External Experts, Peer Review

19. Evaluation: Periodic Assessment Cumulative Nature of Policy Development Evaluation by Insiders and Outsiders Upgrades in powers, processes, organization

20. X. Leadership Right Mix for the Leadership Team – Head and senior managers Long-Term Orientation: Cumulative Contributions Over time Special Issues with a College Political Autonomy and Legitimacy

21. The Virtuous Cycle Experimentation Assessment Refinement Fred Hilmer’s Commandment