The Role of (In)formal Governance and Culture in a National Competition System: A Case of a Post-Socialist Economy

Research increasingly suggests that the effectiveness of competition laws and policies could be enhanced if their implementation is linked with a better understanding of the cultural influences on competition-related decisions. Moreover, the lack of competition culture has been considered one of the main barriers to the enforcement of competition rules. But the studies examining this interplay of competition policy and national culture appear to be rather limited. Based on interviews with key actors of the Croatian competition system, this study examines the interaction of the competition system and the national culture through the governance perspective of a European (post)transitional society. Our findings indicate three key features that are unlikely to support the competition system development: first, collectivism and high power distance in the society; second, a strong influence of planned economy legacy; and third, a clash between the process of Europeanization and inherited collusion-friendly (in)formal governance mechanisms. Based on a unique set of empirical evidence, the contribution of this article lies in the analysis of the relations between modes of governance, national culture, and competition system development in a post-socialist society. This study is expected to have broader resonance for other post-transitional countries and for other developing countries with similar cultural features.