CUTS-CREW
Diagnostic Country Report
Presentation by
Indicus Analytics
24th July 2013
Structure of analysis
1.
2.
Identification of components of competition reform
Institutional responsibility in reform implementation and actual
performance review
i.
ii.
3.
Impact of competition reforms on market structure
i.
ii.
4.
5.
6.
Failed reform initiatives unlikely to have any (positive) impact, but
will have lessons to learn on reasons for failure
Successful reforms, in addition to welfare impact, will also have
lessons on the administrative structure working behind the success
of the reform initiative as well as how the policy was implemented
Market structure based on Porter’s “Five Forces”
Analysis based on DFID Competition Assessment framework
Impact of competition reform on consumer and producer welfare
Assessment of consumer and producer concerns
Further suggested reform initiatives and likely benefits
Methodology
STEP 1: DESK BASED RESEARCH
STEP 2: FIELD WORK
STEP 3: ANALYSIS
STEP 4: REPORT WRITING
Methodology
STEP 1: DESK BASED RESEARCH
i. Thorough literature review, discussion with expert of
competition policy, reform initiatives, previous studies
ii. Collection and analysis of secondary data
iii. Stakeholder identification
iv. Selection of impact/welfare issues to be covered , hypothesis
formation
v. Selection of variables on which data to be collected,
identification of data sources
vi. Development of questionnaires for perception survey,
vii.Development of guidelines for in-depth interview
viii.Finalisation of sampling framework
Methodology
STEP 2: FIELD WORK
i. Data collection on price, alternates, etc.
ii. Perception survey
iii. In-depth interview
STEP 3: ANALYSIS
i. Quantitative PLUS Qualitative
ii. Impact of reform
iii. Changes over time
iv. Comparison across state/ city/ routes
STEP 4: REPORT WRITING
1(iv) Competition Reform and Welfare
Staple food – Producer welfare
• BENEFITS TO PRODUCERS FROM POLICY • PROCUREMENT
REFORMS
– Scope and role of private players in
– Minimum Support Price reforms,
procurement of agricultural produces
in general and wheat/rice in
– Reform in procurement policy,
particular
– Reform in the Public Distribution
– Extent of private participation, etc.
System,
• WAREHOUSING
– Reform in buffer stock maintenance
policy,
– Extent of private participation
– Reform in fertilizer subsidy, pricing,
– Regulatory aspects – consistency,
distribution policy, etc.
level playing field, etc.
• ACCESS TO INPUTS (FERTILIZER, WATER,
– Access to infrastructure like
FINANCE, ETC.)
availability of power, transport, etc.
– Ease and extent of access to inputs
• MARKETING OF AGRICULTURE PRODUCE
across all types of producers
– Role and activities of APMCs and
• CONTRACT FARMING POLICY
extent of control of the APMCs in
marketing channel,
– acceptability among the farmer
community,
– Extent of private participation, nature
of participation, ease of entry, etc.
– nature and extent of demand,
– production,
– general terms and condition, dispute
resolution framework, etc.
1(iv) Competition Reform and Welfare
Staple food – Consumer welfare
•
•
•
•
SUPPLY SIDE
– Availability of adequate supply of staple food
• in both open market as well as through PDS
• across different times of the year
• at different locations, especially the interior villages
PRICE OF STAPLE FOOD
– in open market and in PDS
– determinants of price dynamics
– stability in prices over time
QUALITY – PRICE INTERACTION
– Availability of decent quality staple food at right price for ordinary consumers
WELFARE ISSUES ACROSS DIFFERENT TYPES OF CONSUMERS
– Household consumers
– Business consumers (hotel, food processing, etc.)
1(iv) Competition Reform and Welfare
Bus transport – Producer welfare
• EASE OF ENTRY FOR PRIVATE OPERATORS
– At policy level as well as industry
structure level (e.g. issues like
cartelization, transport syndicates, etc.
formed at the private level which
hampers free entry)
• FREEDOM AND TRANSPARENCY IN
OPERATIONAL DECISION
– Process of fare determination
– Process of route identification
– Decision on number of buses to ply on
each route, across different time
points, etc.
– Price adjustment in response to input
cost (fuel price, financing cost, etc.)
changes
• COMPETITIVE NEUTRALITY
– Whether level playing field exists for all
players
• PREDICTABILITY OF REGULATORY
ACTIONS, GOVERNMENT POLICY
FORMULATION AND INTERVENTION, ETC.
• EASE OF DOING BUSINESS
– Whether the business is subject to
significant regulatory, procedural, etc.
burden hampering the productivity
• ACCESS TO ESSENTIAL SERVICES
– E.g. road infrastructure, finance, bus,
etc.
1(iv) Competition Reform and Welfare
Bus transport – Consumer welfare
•
•
•
•
•
•
•
AVAILABILITY OF BUS TRANSPORT
o Coverage by bus transport as a share of total passenger movement
o Overall as well as frequency across different hours of the day/week
o Certainty of availability
o Demand-supply gap
PRICE SETTING MECHANISM
o Evaluation of the price setting mechanism in terms of its fairness towards the end
consumers vis-à-vis the transport operators’ interest
PRICE DYNAMICS
o The bus fare dynamics in actual/historical experience and its welfare impact
PRICE-QUALITY INTERACTION
o Choice to consumers in terms of alternate bus transport modes available
o Comparative evaluation of pricing structure of alternate modes
SERVICES AVAILABLE TO CERTAIN SECTIONS OF THE SOCIETY
o E.g. small traders, women, students, etc.
ENVIRONMENTAL STANDARDS FORMULATION AND IMPLEMENTATION
PASSENGER SAFETY STANDARDS
1(viii) Sampling framework
Coverage
Staple food
Bus transport
•
•
Only wheat
Two states to be covered
– Uttar Pradesh
– Punjab
•
•
Both are major producers of wheat
540 samples from each state
– Perception survey: 400
– In depth interview: 140
• In case of inter city transport, two routes
each from two states to be covered
– Gujarat
– Karnataka
• In case of intra city transport, two cities
to be covered
– Ahmedabad
– Bangalore
• 345 samples from each state
– Perception survey: 300
– In depth interview: 45
1(viii) Sampling framework
Perception survey
Staple food
Bus transport
1. Producers – 200 sample per state
• Distributed equally into top 4 wheat
producing districts
• Producer selection in each of these 4
districts through stratified random
sampling
• Sample will represent large/medium/small
wheat producers
2. Consumers – 200 sample per state
• Distributed equally into top most, middle 2
and bottom district in terms of annual
consumption expenditure per capita
• Stratified random sampling to be used for
sample selection
• Different types of consumers to be
included – across different expenditure
classes
1. Inter city passenger – 100 sample per
state
• Two routes per state to be covered
• 50 passengers to be surveyed per route
• Sample selection will be stratified
random
• Passengers across alternate modes of
services (AC vs Non-AC, Volvo vs NonVolvo, etc.) to be covered
• Intra city passenger – 200 sample per
state
• 3 to 4 major bus depots to be identified
• 1 to 2 busy routes operating from these
hubs to be identified – max 5 routes
• 40 regular passengers from each of the 5
routes to be surveyed
• Sample selection will be random
1(viii) Sampling framework
In depth interviews
Staple food
Interviews Bus transport
Interviews
Input Suppliers : Public
10
Input Suppliers : Private
Middlemen
10 Input Suppliers (petrol,diesel)
10 Bus Operators: Public & Private*
Traders
Government Officials
10 State Government Officials
20
Inter city
5
Storage: Public
5
Storage: Private
10 Input Suppliers (petrol,diesel)
10 Bus Operators: Public & Private*
10
Millers
20 State Government Officials
10
Distributors : Public
Community Based Organisations
10 Total
45
10 *: distribution of 10 samples into public and
private operators will vary in accordance to
5 the nature of local transport network.
5
Business consumers
10
Distributors: Private
Farmers/Business Associations
Total
140
Intra city
5
10
Field work
Data collection - Primary
• Methods to be followed
– Field survey
• Information on price, quantity, quality, etc., especially in the bus
transport sector where secondary data sources are likely to be limited
– Perception survey
• Focus on close ended questions
– In depth interview
• Guideline based open ended discussion
• No Focus Group Discussions
– Logistical difficulty
– Possible unwillingness to share information in public
• No separate case studies
• Information collected in the course of interview with select
stakeholders which may help in highlighting specific issues that will be
included in the report
Analysis
• Quantitative
– Comparison across time: impact on select variables pre and post reform
– Comparison across state, city, route: impact of a particular/similar reforms across
state/city/route
– Impact comparison across different reform initiatives
Note: Period of coverage in case of the above three points is proposed to be limited to
the post formation of Competition Commission of India in 2002.
– Analysis of questionnaire based perception survey of wheat producers & consumers
as well as passengers on competition reform and impact
– No “quantitative” cost-benefit analysis
•
•
•
•
Difficult to capture all impacts
Scope of inclusion of costs and benefits subject to debate
Increases data collection requirement – problematic in the current time and budget constraints
Monetary value imputation of impacts highly subjective
• Qualitative
– In depth interview
• View of stakeholders and also of producers/consumers of wheat and bus passengers
Thank you.
Comments please.