Below are details of reports recently published under the OFT's ongoing programme of economic research. Further current and completed research is available, listed through the links at the bottom of the page.
Research reports can also be accessed through the economic research publications page.
Most recent economic research
Competing on Quality - Literature Review
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The quality of goods and services is of key importance for customers in many markets and suppliers often compete to win customers' business not only on price but also on quality and other non-price dimensions. This report reviews what the economics literature has to say about the link between competition and quality, in particular for the healthcare sector.
The report reveals that the economics literature provides only limited insights into the impact of competition on quality when businesses are free to set both prices and quality levels. In contrast, the literature suggests a positive relationship between competition and quality when prices are regulated, provided that the regulated prices are set at a level so as to sufficiently cover costs.
For the healthcare sector, the report reviews empirical studies on the actual impact of competition on the quality of healthcare services and the behavior of patients, GPs and healthcare providers in the English NHS, finding outcomes that are consistent with the predictions of the economics literature.
Cost pass-through: theory, measurement, and potential policy implications
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Cost pass-through arises when a business changes the prices of the products or services it supplies following a change in its costs. The Office of Fair Trading (OFT) has commissioned RBB Economics to undertake a comprehensive review of the literature on cost-pass through as pass-through is relevant across much of the OFT's work. The report highlights that cost pass-through is likely to differ according to a number of factors (such as the responsiveness of demand and supply conditions a business faces) and contains guidance for practitioners dealing with pass-through related issues.