Two-time Competition Bureau Chief Economist, Dr. Lilla Csorgo speaks with Counterfactual host Charles Tingley about her experiences and reflections in practice and within different enforcement agencies.
In our second episode, two-time Competition Bureau Chief Economist, Dr. Lilla Csorgo, speaks with Counterfactual host Charles Tingley about her experiences and reflections in practice and within different enforcement agencies as a globetrotting economist…and also her creative side and recommendations for a top Kiwi travel experience.
Introduction 0:00
Welcome to Counterfactual, the podcast brought to you by the Competition law and Foreign Investment Review section of the Canadian Bar Association. counterfactual takes a fresh look at issues relevant to business competition and related areas of regulation and explores the real and hypothetical worlds to gain practical insights and debate policy. Hope you enjoy the show.
Charles Tingley0:28
Before we get started a few words about our guest, Dr. Lilla Csorgo is the chief economist at the Canadian Competition Bureau. Just prior to joining the Bureau, Lilla was a senior consultant at Charles Rivers Associates her other most recent positions include head of economics at the Hong Kong Competition Commission, and Chief Economist at the New Zealand Commerce Commission - Competition Branch. Her positions in Canada have included Special Economic Adviser to the Canadian Competition Commissioner and Economist Lay Vember of the Canadian Competition Tribunal, the body responsible for adjudicating reviewable practices under the Canadian Competition Act. She has also worked extensively in the private sector, including as Vice President at Charles River Associates. She has provided technical assistance to foreign governments regarding competition law and policy on a number of occasions, has lectured on microeconomics, industrial organization, and transition economies. She holds a PhD in Economics from the University of Toronto. Lilla, hello and welcome to Counterfactual. We're so glad you could join us.
Dr. Lilla Csorgo 1:33
Well, thank you very much. I'm glad to be able to join you. Before we get started, I did want to actually just put that disclaimer in that anything that we discuss here are going to be my views and not necessarily those of the Competition Bureau, the Commissioner or the Department of Justice,
Charles Tingley 1:51
Well understood, and well said. We have a fair bit to talk about. But let's start if we can, at the beginning, maybe even going back to your school days. And I'm curious, how did you get into the field of economics?
Dr. Lilla Csorgo 2:08
That's a bit of a sad story, pathetic tale, not one to inspire anyone. I come from a family where math and science was very much promoted, and neither of which I wanted to do. But to prevent my parents from having a heart attack and studying something like history or anthropology, I thought a good middle ground was economics. So it was really quite lucky that I ended up liking it.
Charles Tingley 2:38
Well, I think that's probably a story that a lot of lawyers can relate to, frankly. Was there was there anyone or anything that played a significant role in you sort of becoming at least the type of economist that you are?
Dr. Lilla Csorgo 2:52
Yes. And it was actually really pretty well into my career. And that is one one, where I sort of first stumbled upon industrial organization in grad school. And then also even when I was working as a consulting economist, where I had really just the great pleasure and the benefit of working with both Professor Frank Mathewson and Professor Ralph Winter, which was, yeah, hugely influential and made a big difference in terms of just really deciding to make a career out of this.
Charles Tingley 3:26
You know, it's funny, you talk about your, I guess, influences in the sense of people who steered you maybe towards a particular area. But it also occurs to me that there are schools of thought, especially in that particular area of economics. And I know that, you know, I kind of came up the ranks in my own way and with your own thinking and being informed in my particular environment. But, you know, were you influenced initially by a particular school of economic thinking, during your formative years?
Dr. Lilla Csorgo 3:57
Well, I was quite lucky when I was in grad school, that economics thinking in industry organization was already post Chicago School. And, and I do think that the Chicago school very rightly challenged some of the non rigorous thinking that was occurring in industrial organization and competition economics in the competition enforcement prior to that. But, you know, all the way back in the late 1980s, when I was first started in grad school, we were already past that way of thinking. I mean, there was very much this "yeah, you know, resale price maintenance or predation, maybe that doesn't make any economic sense, Oh, except, you know, when it does" or something like exclusionary practices that that really aren't that common, oh except when they are and they do actually have an anti competitive effect. And so even though that was sort of late 80s, early 90s, I feel like, you know, the economics has already moved beyond Chicago School at that point. And, and so that very much was very influential and continues to be influential in terms of how I think about things. I mean, I would say it's the law that has been a little bit later to the game, so to speak. I mean, I, when I started, first working in this area, I was amazed that resale price maintenance, for example, was, you know, not only per se illegal, but it's also criminal. I mean, that didn't change until 2010. And, and having that kind of approach to something like resale price maintenance, I mean, that's not Chicago school. That's like, pre Chicago School. And, and they're, you know, like, lots of examples of that. But luckily, I came to grad school when we were in a more open minded place in terms of the economic thinking.
Charles Tingley 6:08
Yeah, and well, that's, that's quite interesting. So it sounds like already, you know, there was sort of an open mindedness, you know, I guess, or a post open mindedness approach or what have you, when you when you started, but do you feel like any any school has, has kind of come up and either replaced it? Or is competing with with, you know, the thinking, you know, during, you know, most of your career or as, are you still within the same framework?
Dr. Lilla Csorgo 6:39
Oh, well, I would say I'm largely within the same framework. I mean, in terms of real developments, big developments in terms of the economics and thinking since I was in grad school, and and over the course of my career is really sort of this applied Industrial Economics, which is kind of that more empirical approach, which certainly has its pros and and certainly has, has some, some cons as well. I mean, the one place that I would say that my economic thinking has changed is the consideration of efficiencies. And also, I would say that my experience in Hong Kong was really quite eye opening as well, I mean, that really had this feel of, oh, you're not in Kansas anymore Dorothy, and it is such a completely different set of markets than I have ever seen, either in Canada or the US or, or in New Zealand, where, you know, we have conglomerates, and these massive families that control so much of the economy, the sort of question of politics and the influence of government. I mean, we even have triads playing a big role. And so there, I would say that, that sort of the traditional economic thinking, and, and what I would have learned in school, you know, didn't apply in a sort of straightforward way.
Charles Tingley 8:09
Well, that's, that's a whole that's a great answer. And very interesting with respect to Hong Kong. And I do want to get back to your experience in Hong Kong and in other places in a minute, but just sticking with your sort of private practice, experience. You know, do you have any particular experience, you know, what it's like to be an expert? And, you know, working, frankly, working with lawyers, and what that what's that? What that's like, and you can be honest there, but, you know, I, I assume you've had some, you know, some interesting experiences, either as a witness or preparing and assisting, you know, your clients to develop their cases.
Dr. Lilla Csorgo 8:55
Yeah, sure. I mean, I, I mean, there's always that divide in competition, economics, policy, law, between the lawyers and the economists, and they always seem to be at odds with each other, at least, that's the, the myth, or perhaps, in some cases, the reality. But I think that there's a huge benefit in in terms of that it, it forces you to, to explain the economics in a way that is, is compelling and intuitive. And, and I am a believer in that, that if you can't do that, then perhaps you're a bit of a charlatan. And so I think that there's a lot of benefit in having to work with with non economists that way. And and I've also been impressed over the years just the extent to which lawyers have really become like pretty decent economists since
Charles Tingley 9:54
Well that sounds dangerous.
Dr. Lilla Csorgo 9:57
Well, yeah, don't overstep your bounds.
Charles Tingley 10:02
Understood. Do you mean do you have any tips for lawyers working with economists?
Dr. Lilla Csorgo 10:06
Yeah, don't let us get away with that sort of Hocus Pocus, mumbo jumbo kind of talk.
Charles Tingley 10:13
All right. Okay. Well, that's I suspect people will take you up on that.
Dr. Lilla Csorgo 10:18
As they should, although, who knows, maybe I'll come to regret those words.
Charles Tingley 10:23
And now, obviously, you've you've worked, I suspect, even in private practice on on both sides of the enforcement side of the ledger, whether for respondents or for agencies. And I just wonder if there's any difference in approach that you take to those mandates or sort of as a an independent type advisor, you know, you would anticipate that you wouldn't necessarily, but you never know.
Dr. Lilla Csorgo 10:51
Yeah, no, not not really. I mean, I would hate to think that that that, that you would take a different approach, just depending on whether you're working for an agency or, or someone within in the private sector. Yeah.
Charles Tingley 11:04
Maybe it's more different considerations with respect to who your client is, and, and what, you know, what, you know, how working with them operates? Perhaps I'm not sure if there's anything coming out of that.
Dr. Lilla Csorgo 11:17
Yeah, not so much. Yeah, I would say, I mean, the sources of information are different, the biases might be different. But at the end of the day, the economics is very much the same.
Charles Tingley 11:33
Well, that's comforting. So, I mean, that does bring us into your agency experience, which is rich and varied. And just starting with Canada, of course, this is actually your second tour as chief economist at the Bureau. And it's obviously early days in that tour. But nevertheless, I would imagine that, you know, times have changed since your first go round. And I'm curious to know, whether you you see any particular significance, or significant change, or maybe things have stayed the same? Since your first tour and how you see kind of the landscape?
Dr. Lilla Csorgo 12:10
Yeah, well, I would say somethings have not changed, I mean, some of the preoccupations with the past and they're not always amazed that that those preoccupations can sometimes just linger for not just years, but for decades. And then in other ways of things have changed quite a bit. Very much so I would say in Canada, in the context that the emphasis on quantification of and particularly in the context of merger analysis, and, and trade off between anti competitive effects and and efficiencies.
Charles Tingley 12:46
So So I mean, that you talk about preoccupations that have that have been enduring, I suspect that might be a reference to efficiencies as well, as part and parcel of this quantification, I suppose. Do you? And maybe that's also an example of evolving thinking on your part. But if you're able to share with us your thoughts on on the proper place of efficiencies?
Dr. Lilla Csorgo 13:12
Yeah, well, not as a defense. It's the simple answer. I think that that that is very much a place where they act needs to be reformed. Where it should go instead? Honestly, I'm not really all that certain. I mean, certainly that the Bureau has largely sort of suggested that it perhaps be a factor. I personally think that that we should be a little bit sort of more expansive than our thinking and and not sort of settle on any particular place for it at this juncture without kind of further consideration. I mean, one of the things that I think that that is, is certainly open to consideration or should be open to consideration is more of a New Zealand Australian approach where there's an authorization and it's only under authorizations that efficiencies are considered or maybe there is just some other third way that that might be better. And so I'm glad to see that that that would likely be part of the consultation process, or I hope it would be.
Charles Tingley 14:24
Right. Well, no, that's interesting. And it may be one of the few reforms that is subject to consultation, it seems based on on how the reform process is, is unfolding at the moment as part of the budget bill. But in any event, I guess I would also ask, are there any other areas of the law or jurisprudence that that concern you at the moment?
Dr. Lilla Csorgo 14:48
Well, the other big one would be that it's not clear that section 79, so the abuse provisions that that actually contained some that would cover off facilitating practices and, and of course, I very much would like to see that covered off in a clearer way so that it's not subject to any kind of uncertainty. I mean, that is a means of abuse that's clearly considered and in other jurisdictions, and that there have been cases under those, and it's there's no reason why Canada should be unique in that regard. And in terms of not having covered having it covered off in the law.
Charles Tingley 15:26
On that point, you know, what are your thoughts about I mean, that comes in, I think, at the, at the point at which purpose is considered in terms of a practice of anti competitive acts, rather than just the effects or the likely effects of the conduct? I think that's been viewed as a, you know, maybe not the highest already sort of bar as a screen. But nevertheless, a screen? Do you feel that maybe there's a risk there of sort of writing out that purpose, sort of out of out of the provision and just leaving yourself with, you know, sort of potentially dominant firms and the effect of their conduct? I know, in New Zealand, this has been a big issue under there. Well, it's been reformed since but they're their old provision, I suppose, for abuse of dominance, and how to allow dominant firms to distinguish properly, you know, and police their own conduct, without risk of being always exposed to action.
Dr. Lilla Csorgo 16:32
I mean, that's a that's an excellent question. It's just, and it touches upon a bunch of different things. And mainly, just how do you identify abusive conduct? And is there some sort of special responsibility, which is the sort of terminology that they use in the European Union? And it's the kind of language that I'm not personally all that comfortable with. I mean, the one thing that I think that Canada does really have right, compared to some other jurisdictions, is that there isn't this sense that somehow dominance has to come first. I mean, there is the possibility that the anti competitive act itself is the thing that created dominance. And and that's not actually clear in other jurisdictions, but certainly, I mean, if, if you obtained your market power through the act itself, I don't think that you should be exempt from the law. Does that mean that that there is greater uncertainty for businesses as a result, because even a firm that doesn't have pre existing market power, can be in a situation where it runs into trouble? Well, the answer is, is yes. But I also don't think that we need to sort of overstate the uncertainty about that it's not as if we have tons of abuse cases in any jurisdiction. And so and I think firms are pretty well placed to, to self police said he's you say, to know, whether they're engaging in an act, really largely because of the anti competitive effects, as opposed to some sort of reasonable business justification.
Charles Tingley 18:17
Well, I guess both of these topics, this and efficiencies, you know, are in a particular context, you know, the Canadian context has been talked a lot about in terms of how the modern Act was developed. And, you know, for instance, kind of a relatively small economy, geography, etc, need for scale, and that sort of thing, and I want to get the opportunity to ask you, whether you feel that, I guess, whatever the establishment looks like. And we've heard a lot of new voices recently in connection with law reform that, you know, in adjacent areas or in academia, that the don't sound a lot like the competition bar or even the Competition Bureau. But do you feel that the so called establishment is too stodgy, too conservative? On any particular points? Are there any tropes that need to be taken out and dealt with?
Dr. Lilla Csorgo 19:17
Well, I mean, you did mention one of them in passing just when you posed that question. And and that was that whole small economy thing? I mean, Canada is is one of the biggest economies in the world, it's certainly in the in the top 10. It's a g7 country. So to the extent that traditionally, the so called small economy of Canada has been used as a reason to justify the efficiencies defense and that I mean, I think there's all sorts of reasons why that defence shouldn't be there but, but the fact that Canada is, is not a small economy is is is just one of them. And, you know, I've remember foolishly using those words when I was doing some work for the World Bank in Costa Rica, and I had the reaction exactly as you would want them to react, which was just complete, utter disbelief that I, in the context of Canada would use the word small, in any way. So, so if I were in Costa Rica, and I use the word small, or even in New Zealand, or in Hong Kong, if I use the word small, most that word would have been, would be much better justified. So So that is certainly a trope that I think that that we should do away with.
Charles Tingley 20:41
Maybe it depends on on, on how high the country is setting its sights and who it sits beside, etc. But I take your points, I did want to just talk a bit about digital markets, because I think they are. They appear to be, you know, driving a lot of the public discourse, of course, anti-trust has become quite interesting and popular and political. But, you know, I go, and so digital markets as being the reason possibly why competition laws need to be reformed, to be able to accommodate the conduct and in digital markets, that's said to be different and special. But the first of all, just, you know, when I look through, you know, even going back quite a long way. You know, enforcement activity, at least in Canada, I don't see too many cases, involving, you know, sort of so called digital markets, or, or, and certainly not kind of platform type industries. So I mean I'm curious to know, because I don't see it every day in my practice, you know, how much bandwidth do unique digital issues really take up in economic analysis today, you know, at the Bureau, in terms of, you know, enforcement as opposed to maybe sort of blue sky thinking?
Dr. Lilla Csorgo 22:05
Well, I mean, I don't know if I'm fully at liberty to say as to how much bandwidth it takes up. I mean, certainly, it was noted as being a priority area. So it at least takes up some some bandwidth. I mean, whether they will see results that that that's not for me to say, at this stage.
Charles Tingley 22:30
Yeah, I suppose. You know, some people say, well, a lot of these platform parties are based in other countries, and certainly the US and the EU, in particular have a points of view, you know, should we be, you know, just essentially keeping a watching brief rather than proposing significant changes to our laws, etc? I don't know, if you have
Dr. Lilla Csorgo 22:54
Well, I will put that into two different camps. I mean, there's the question of any kind of legislative reform, and, and this question of enforcement, and and certainly, I would say that in any matter to the extent that you can freeride on enforcement taking place elsewhere, because the remedies also going to benefit benefit Canada, then, then then, you know, why would you expend scarce resources on that kind of investigation? To the extent on the other hand, that that remedy is not going to benefit Canada, or that there are sort of unique features to to the Canadian context and so consequently, you need sort of a unique Canadian solution, then, then, then obviously, that that is a different question and and they warrant the enforcement resources. In terms of legislation, I mean, there's all sorts of legislation that is well outside of competition law, or at least somewhat outside of competition law that is being considered or actually they're going forward with in either Europe or, or in the US. And I mean, at this stage, I would say that there are enough concerns with the Competition Act, that we should sort of focus on amendments to the Competition Act. In the meantime, hopefully, we'll see how the changes in law in Europe and the US might play out and to see if there are benefits to them. If there are things that that Canada should can't actually benefit from without actually enforcing or amending or implementing sensitive new new law, then then all the all the better. But in the meantime, I think the focus should be really amendments to the Competition Act.
Charles Tingley 24:46
Well, I suppose sort of related to what you're discussing, but it's also potentially part of the act of our discussions in some circles around, you know, expanding the objectives of the act. Um, you know, so called hipster sort of anti trust? And I don't know, does that resonate at all? Or does that cause you concern as as an economist for, you know, just what the act can handle?
Dr. Lilla Csorgo 25:14
Well, I mean, first, I want to say that hurray to the hipster economists, I think that that is fantastic that they're rocking the boat that way, that they're drawing attention to these issues. So that said, though, that I'm going to say I'm going to sound like an old fogy in reaction to them is that I don't think that the objectives of the Competition Act should be widened. But that that isn't the only thing that the hipsters are talking about. I mean, they're talking about a bunch of different things that I think are well within the purview of the Competition Act, or could be within the purview of the competition acts such as the treatment of nascent competition, better consideration of dynamic efficiencies, you know, whether we have been lax in our merger enforcement, whether we're lax in looking at sort of potential abusive conduct, all of those things are things that that I think is terrific that is being questioned and, and should very much be taken on board and thoroughly considered and possibly have changes in enforcement action or, or related policy, or, you know, where the Act currently falls short, to have amendments to take those into consideration.
Charles Tingley 26:40
So just to switch gears here a little bit. I'm curious about how the role of economics is streamed into the Bureau's decision making. I know that, it seems sometimes that the structure of the Bureau changes every now and again, and understanding where for instance, you and other economists are housed in the organization, how their input is taken into account in decision making. You know, sometimes it's a little mysterious as counsel, you know, you do have some interactions with with economists, members of teams and things like that, but, but often, it seems like things are going on in the background. But in any event, maybe you could enlighten us a little bit about how, you know, economic thinking is taken into account that it may it may vary depending on on the different things that the Bureau does, but I don't know if you can give us any insights.
Dr. Lilla Csorgo 27:38
Yeah, I mean, first, I would say that where the economics team is housed, shouldn't be taken as a signal of anything. As far as I as long as I've known, the Bureau, the economics team has been housed in some sort of policy type branch. And, and that is a bit odd in the sense that that, again, ever since I've been familiar with them, even though they might engage in some of the policy work, they're far more engaged in, in enforcement. And and there has been a ongoing debate, which, again, is one of these things where I'm amazed that it's as ongoing and as long lasting as it has been, and not and it's certainly not unique to the Competition Bureau. But I think it sort of stems mainly from the US where the economics team, there tend to be quite independent from the lawyers and and the legal team, there tends to be sort of sort of part and parcel of the investigators or that they are the investigators. And and consequently, they sort of have this independence or this sort of separation of opinion that, that sometimes other jurisdictions try to duplicate. But the truth is, is that the other agencies are just not big enough to be able to duplicate what the US does. I mean, from what I understand, I mean, they almost have separate lines of investigation with the legal team and the economics team. And sometimes they agree, and sometimes they don't, but they really don't tend to overlap as much as they would in other jurisdictions. And so here and elsewhere, you can't afford to do that the the economists are really much more embedded in in the investigations. And I think that that is kind of the right approach and you want to have that mutually beneficial exchange right, right from the beginning. So they are there even if you might not see them always.
Charles Tingley 29:45
Oh, I'm sure I'm sure. I mean, what does your if there's such a thing and there probably isn't, you know, what is your average day or week look like at the Bureau and I recognize that it's a bit of a funny environment there has been for the last couple of years, with COVID, but nevertheless, is there sort of a, like, I know I've experienced in other contexts, sort of like, not with respect to the Bureau, but, you know, sort of meeting-itis or what have you, but I don't know whether you have. You know, I just be curious to know what the chief economist sort of does at a high level.
30:35
Yeah, sure. Sure. I mean, I have to say that it was a bit bizarre starting a new job from home.
31:02
And, and I still haven't really well, not even really, I've not met anyone in person yet. So in that sense, I do think it was a real advantage, just personally, that that I had some familiarity with the Bureau, as you mentioned, I've been TD McDonald chair before, some of the personalities are the same. And, and so, so it wasn't quite as strange as it could be to meet everyone for the first time over over video.
31:34
But I yeah, I do miss, I think the advantages that you could otherwise have with just sort of more personal interaction.
31:42
But in terms of kind of my day to day work, I'm sure much to the irritation of the investigation teams, I'll sort of come in and, and look at a 30,000 foot level as to kind of what's going on and try to provide the benefit of my 30,000 foot view. One of the advantages I would say of that is that you do kind of get that fresh eye thing, and hopefully some eyes with experience, but also because I am doing this across a number of enforcement's then,
32:19
if there are sort of potential inconsistencies in approach, or if there are sort of benefits and, and insights in one file that another file could benefit from, or, or if there are policy implications that because team members are just so embedded in it, that they're kind of not seeing that there are these policy implications, then, then then hopefully, I am drawing those in to relief and and and then putting sort of a proper decision making process, helping to put a proper decision making process around that. I'm also involved directly in sort of policy considerations. Of course, you know, we are looking at amendments to the Act, some of them are already in play and other ones, or are going to be considered so, so quite directly involved in that. And yeah, and occasionally, I will get involved in a lot more of the kind of nitty gritty of any particular investigation, if the idea is that I play a role of more of a of an in house expert.
33:27
Yeah, and along the way, hopefully, I'm also managing to do some mentoring.
33:34
I'm sure you're very good at that. And I guess in terms of your accumulated experience with respect to all of that, let's talk about some of your international experience, because I think it's really interesting. And just starting with New Zealand, so you and I obviously have something in common, which is that we both worked at the New Zealand Commerce Commission, and we overlapped for a bit there. And so
I'm always curious with something as significant as moving across the world, you know, what took you to New Zealand?
34:03
Restlessness,a search for a bit of adventure, some different scenery. Yeah, nothing more radical than that.
And all very legitimate objectives, as far as I'm concerned, sounds very similar to what took me there as well. But, but I know that for my part, you know, working with the Commission, certainly opened my eyes to different ways of structuring competition enforcement, and all sorts of different legislation, case law, legal culture.
34:35
So I would ask, you know, what struck you most about your time at the Commission?
The differences in process, really, and and that I, I first really properly became aware as to how much process matters when I was at the Competition Tribunal. You think that it would be more obvious earlier than that? Maybe that is that sort of narrowness in terms of the economic thinking,but process really does matter. And the process is quite different in in New Zealand in terms of that they have a commission structure where commissioners are making decisions and clearing and declining mergers, for example, but also just in a very transparent way being the decision makers as to whether they go forward with other invest other matters and and bringing them bringing them to court.
35:31
So, so that sounds like oh, well, perhaps, that shouldn't have that many ramifications. But I do think that it has a lot of ramifications all the way down the line in terms ofhow mainly in terms of transparency, but the transparency, then also, I think forces a type of rigor in public statements that you you might not otherwise have.
That's interesting. Certainly, I'm familiar with that, with that process, the commission process and it was certainly new to me at the time.
36:07
Is there anything to that? That is, well, I suppose it would be quite really different from the from the Bureau process, although I don't know, the the internal sort of paperwork element of the Bureau, but I do recall at the Commerce Commission, you know, it was quite a formal, you know, semi hands off or arm's length, I should say, approach between staff and, and the commissioners such that you're in a sense, kind of taking your case to the Commission for for albeit sort of internal decision making, but nevertheless, as you say, sort of sort of, I don't know, in some cases, it's transparent, some cases less so. But, but it's nevertheless a separation, I suppose. And I don't know if that is something that I assume it's not quite the same at the Bureau. There may be, you know,advantages and drawbacks in different situations in terms of efficiency, or, or speed or what have you, but, but I don't know if you come out on any particular side of that?
37:08
Well, I mean, I think that there areadvantages to at least considering alternative processes. I mean, that there are amendments, of course, being considered are already in play with it with respect to the Competition Act. And I don't know why the process whether that is with within the Bureau itself, but also just more widely with the credit Competition Tribunal process, would that wouldn't be as opened to consideration as to well, can this be improved? And and that is not a criticism of the of the current structure, but rather, you know, sort of just sensible in terms of in terms of any process that, that that there, that question should be regularly asked. And, and I would like to see it asked here as well.
You've mentioned the Tribunal. Obviously, you were a lay member on the tribunal, previously. You know, are there any particular considerations you would you would throw open for debate, if you were to perhaps improve that process? I mean, just coming back to New Zealand, and it's, it's the same in other places to, you know, the regular courts, you know, deal with deal with,you know, with those sorts of decisions in the enforcement context, although, for that matter, you know, certain decisions are taken by the commission itself that are that are public facing, but you know, not not to preempt your your response, but I don't know if there are any thoughts that you have, in particular about the Tribunal?
Oh, I feel like that's just such a dangerous question. And that, that no matter what I say that I would, I would get myself into trouble. I mean, that I don't think that I'm saying anything radical when I say that that process is incredibly slow. And, and there have been attempts historically, even while I was at the Tribunal to try to speed up that process. I'm not sure if this is something that they still talk about, or is in play. But at the time that I was there, they talked about the the chess clock approach, do they still have that?
I think they they employ it routinely.
39:20
Okay, well,yeah. Nonetheless, it seems like that the process is still very slow. I mean, I look at the Competition Tribunal Act and, and some of the wording that they have there is that, of course now that I said that I can't think of the wording but I mean, it's, you know, something along the lines of that as being an Administrative Tribunal and that it should be
Expeditious
Expeditious. Thank you. That's that's the word. And you know, I mean, it hardly can be accused of that you know.
39:52
And, and it also that Tribunal Act says that they can sort of implement whatever rules they want, and then they ended up
40:00
For the most part, from what I understand, I'm not a lawyer, implementing the federal court rules. And and I think that there was an opportunity for the, for it as an administrative tribunal to be a little bit more nimble. I mean, I certainly think that there's a lot of advantage of having lay members who are
40:22
well versed in the area of of competition law and economics. But I don't know whether it has necessarily lived up to the original expectations.
40:29
Right. So just switching back very briefly to round of discussion of New Zealand. I mean, were there any? Are there any experiences there that you saw as as, you know, sort of your will what you might imagine as the greatest successes, and then conversely, any, any, any particular frustrations or failures?
Yeah, I feel like I'm sort of sort of trumpeting my own horn here. But I would say that, that is something that I feel quite proud of is that when I look at the Commission now versus what it was 10, 11 years ago, when I first went to New Zealand is, is that there is just much a much bigger role of economics than there than there would have been. And, and, and that, that that process is now clearly entrenched. I mean, the economics team is, is much bigger than when I first started there. They now regularly hire economists as as their investigators, and
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always have had commissioners who are economists. And that continues to play an important role. And so it's, it's nice to see that entrenchment of, of the economics.
Certainly then before you arrived, of course, the chair was an economist as well. But now, just switching over to Hong Kong, because you said some very interesting things at the at the top of the of the episode about, I guess, some very specific
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jurisdiction considerations, in terms of how I guess, businesses are organized. And you mentioned family ties, and sorts of things like that, but but maybe just elaborate a little bit on your experience there. And whether there's, there's anything you can take away from that that informs your thinking, you know, outside of that context.
Well, to answer your first your last question, first, is that no, I did find Hong Kong, really quite so unique that, but but I don't feel that I got many tools that I would transfer here. Oh, although, having said that, I realized that that's not completely true. I mean, one, Hong Kong really made me believe, again, that I my belief necessarily had waned, but it reinforced my belief in the importance of competition law, that Hong Kong didn't have such a law until late December or 2015. So December 2015. And so it's very late to the game. And I arrived there in 2017. And there was, it's, I mean, there's just so much Bid rigging and price fixing, it really is quite kind of rampant, I would say.
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And, and, and having a law makes a difference. Educating people makes a difference. I mean, they have done such a terrific job and just sort of putting out the message that that you can't do this anymore.
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And and it's nice to know that that in that sort of just fundamental way in terms of what ultimately kind of the sort of the worst aspects of of firm behavior that that Competition Act is trying to trying to sort of prevent, that it can make a difference. I think Hong Kong is really a good example of that. So in terms of tools,
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then one of them I would say is that it's it was sort of a great, great learning ground for for cartel detection. And some of those tools I think are transferable elsewhere, but otherwise,
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as an outsider as a non Cantonese speaker, it is a very difficult economic environment to really sort of come, come to a good understanding of there are a lot of
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lots of behavior that from the outside doesn't seem to make economic sense or really any kind of sense until you sort of probe more deeply and you understand those, those interesting linkages.
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Across families, across markets, across politics, and and all the rest of it.
I wonder if that I mean, I think when I think of New Zealand, I know that they're their commission is made up of lots of sort of international folk, which makes it an interesting place as well. But with Hong Kong, that might be true as well. But it occurs to me that, I guess, on the one hand, if you're, if you're part of the culture, you would understand, maybe better those linkages. But maybe on the other hand, you need sometimes some outsiders also to
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sort of bring a fresh perspective. And then between the two, the two sides, you can you can address the issues.
And to date Hong Kong is has done that, I mean, that, that they really do have that mix of, of people who are, are from there and from from from overseas.
So you've obviously gone through Canadian agency, New Zealand, Hong Kong, back in Canada.
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But, you know, for a time you returned to practice, and
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I guess, do you see things? And maybe this is just a repackaged question from before and its the same answer. But do you see things differently having been through the agency, various agency schemes?
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Well, you know, I would say that that's when you're on the outside, so no longer at an agency, it can feel very opaque that there is this sometimes a sense of that black box that that information goes in, but nothing comes out. And I am sympathetic to the business, that that, that they would like to kind of know what's going on. In that sense, actually, I would say that that is another thing that that is perhaps
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better done in in some jurisdictions than elsewhere say something like statement objectives, I think that that has a real benefit, not just in terms of letting business know and where their matter stands, but also just sort of the competition community and customers in those markets to get them to sort of know where things stand in the interim as well.
Yeah, I've always kind of thought maybe that I guess it's advocacy or, or how statements are done,
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you know, can can be a good return on investment of the resources that are put in on the enforcement side, even when things don't don't go anywhere, ultimately, I don't know, if you, if that's something you feel that some agencies are better developed mechanisms for doing that. Or where you see advocacy playing a role in Canada in particular?
Well, I mean, I will sort of make a distinction between advocacy and in terms of sort of pursuing government for sort of more competitive outcomes in terms of how they implement legislation and so forth. And and that, I think, is something that is, is a consideration for many competition agencies, agencies consider including the Competition Bureau and the and the Bureau has an excellent track record, for example, in front of the CRTC in terms of that kind of, of advocacy. But yes, otherwise, I think that there is benefit in terms of just as I've said before, just being really transparent. And in terms of the thought process and in what actually went into a certain decision, including if it was part of the decision not to, to pursue anything further, that has a lot of value in it as well.
So I would tend to agree. So we're going to switch gears Lilla, andit's time now for the segment that we call Overtime.
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Overtime is where we take ourselves outside of regulation play and explore some additional lesser known dimensions to our guests, including their personal interests and pursuits and compliance with National Hockey League shoot out format, In our Overtime segment, we take three shots at getting to know our guests a bit better. So here goes Lilla. In addition to your successful career as an economist, some of our listeners may not know that you are also an accomplished author and playwright. What book or play would you recommend to our listeners?
It's a play Copenhagen by Michael frame. Do I just get to say the title or do I get to say a little bit more about it?
Oh, we’ll allow a blurb.
Okay, it's about the meeting of two physicist Niels Bohr and Heisenberg in 1941. And nobody kind of really knows what happened. In that meeting. Heisenberg was working for the Germans on the atomic bomb. And was he there as a spy? Was he there to potentially leak secrets, potentially try to sort of slow down the development of the bomb. And, and the thing that is just so amazing about the structure of the play is that Heisenberg is actually the physicist who is responsible for the so called uncertainty principle. And so the uncertainty about what happened at those events and the uncertainty principle in physics are just beautifully overlaid. So that's my pitch for that play.
Fantastic. Now, is that available in print only? Or is that running?
No, actually, it was recently performed, I think, at the National Art Center. So look out for it. It first came on the stage probably in early 2000s. So it started to get a little bit dated in terms of how often you're likely to see a production of it, but actually think there might even be a film version of it, which I haven't seen. So who knows whether it's any good.
All right, awesome, duly noted. And now, second shot on goal.
51:12
Time to cause a little controversy among your Kiwi compatriots. What is the top in your view must see attraction in New Zealand?
Okay, I'm gonna go with something in the North Island. Because I think that despite it having kind of a more unique topography to the South Island, the South Island is normally the favorite because it has the big dazzling mountains and lakes and for for good reason. It is sort of dazzle the dazzle component. But, but I don't think that the North Island should be overlooked. And in the North Island, I would say it's the Tongariro Crossing is my must do recommendation.
I would heartily endorse that recommendation.
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And so lastly, if you were not an economist doing what you do today, what would you likely be doing?
Well, that is your easiest question to date, I would want to be a paleo anthropologist.
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Okay, How did you develop that interest?
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I have long been interested in hominids.
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So thank you for being so open and honest in in our Overtime segment.
I'm all worried that I've been too honest. And my bureau there's no such thing assort of lamenting that they let me speak.
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Not to mention, not to mention, you know, people, I might still know at the Tribunal.
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If it's not controversial, it's not interesting. So I guess I would also ask, Do you have any particular advice for a junior economist or professional coming up the ranks today.
To not be afraid to change organizations to even change countries. I mean, I say that from personal experience, but there are actually studies to that show that, that there are long term career benefits from moving around. You know, there is that cliche, I think of Millennials only staying in a job for for very limited periods. I mean, I'm not suggesting that people switch so regularly that that that is a deterrent in terms of sort of prepare prospects, because you don't seem to have sort of commitment. But gosh, that breadth of experience is, is terrific. I mean, it just provides sort of insights that you might not otherwise have.
Very well said, I know, certainly my, my albeit more limited. overseas experiencewas transformative.
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Look Lilla, you've been extremely generous with your time. It's been so nice to speak with you. And I would like to thank you for taking the time out to share your experiences and insights with the counterfactual podcast. All the very best, with round two as chief economist at the Bureau, and we'll look forward to catching up with you again very soon.
Thank you very much, and thank you for letting me take part in the Inaugural Counterfactual.
Excellent. It's been our pleasure.
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Thank you for listening. Counterfactual is produced and distributed by the competition law and Foreign Investment Review section of the Canadian Bar Association. The opinions expressed by the participants in this podcast are their own and do not necessarily represent those of their employer or other organizations. If you enjoyed this podcast or would like to join the Canadian Bar Association, please visit www.cba.org/sections/competition-law