Competition in sheltered sectors: the level of the markup

The question arises whether these models can be used for this purpose at all and, if not, what modifications are necessary. This paper briefly describes the economic theory of regulation and deregulation and judges CPB’s sectoral model ATHENA and applied general-equilibrium model MIMIC with respect to their usefulness for analyzing competition policy. Simulations with both models complement the theoretical analysis. The substantial differences in outcomes testify to the need of additional research.