COMPETITION IN THE BUSINESS SERVICES SECTOR: IMPLICATIONS FOR THE COMPETITIVENESS OF THE EUROPEAN ECONOMY.

This paper investigates the nature and extent of competition in the European business services sector. Levels of competition in the sector vary considerably by market segment and location. A number of factors, including the fragmented nature of the market, firm based strategies and regulatory conditions, restrict competition in the sector. The analysis of competition in the business services sector highlights the failure of the market to promote consistently an efficient and quality provision of business services. Given the important role of business services in the economy as a whole and their impact on the competitiveness of client firms, it is argued here that policymakers would be wise to influence competition within the business services sector through a variety of initiatives, with the aim of improving the efficiency and quality of business services provision. Such initiatives would result in positive spill-over effects for Europe's general competitive position in the global economy. [ABSTRACT FROM AUTHOR]