nep-com New Economics Papers
on Industrial Competition
Issue of 2006‒12‒22
six papers chosen by
Russell Pittman
US Department of Justice

  1. Two-Part Tariffs versus Linear Pricing Between Manufacturers and Retailers: Empirical Tests on Differentiated Products Markets By Bonnet, Celine; Dubois, Pierre; Simioni, Michel
  2. Asymmetric Equilibria and Non-cooperative Access Pricing in Telecommunications By Stefan Behringer
  3. Strategic Patenting and Software Innovation By Michael Noel; Mark Schankerman
  4. Prices and Market Shares in a Menu Cost Model (November 2006, with Ariel Burstein) By Christian Hellwig
  5. Co-Opetition and Prelaunch in Standard-Setting for Developing Technologies By Tobias Kretschmer; Katrin Muehlfeld
  6. Product Market Regulation in the Non-Manufacturing Sectors of OECD Countries: Measurement and Highlights By Paul Conway; Giuseppe Nicoletti

  1. By: Bonnet, Celine; Dubois, Pierre; Simioni, Michel
    Abstract: We present a methodology allowing to introduce manufacturers and retailers vertical contracting in their pricing strategies on a differentiated product market. We consider in particular two types of non linear pricing relationships, one where resale price maintenance is used with two part tariffs contracts and one where no resale price maintenance is allowed in two part tariffs contracts. Our contribution allows to recover price-cost margins from estimates of demand parameters both under linear pricing models and two part tariffs. The methodology allows then to test between different hypothesis on the contracting and pricing relationships between manufacturers and retailers in the supermarket industry using exogenous variables supposed to shift the marginal costs of production and distribution. We apply empirically this method to study the market for retailing bottled water in France. Our empirical evidence shows that manufacturers and retailers use non linear pricing contracts and in particular two part tariffs contracts with resale price maintenance. At last, thanks to the estimation of the our structural model, we present some simulations of counterfactual policy experiments like the change of ownership of some products between manufacturers.
    Keywords: collusion; competition; differentiated products; double marginalization; manufacturers; non nested tests.; retailers; two part tariffs; vertical contracts; water
    JEL: C12 C33 L13 L81
    Date: 2006–11
  2. By: Stefan Behringer (Economics Department, Frankfurt University)
    Abstract: This paper looks at competition in the Telecommunications industry with non-linear tariffs and network based price discrimination where one of the networks has a relative advantage. We investigate profit-maximizing network pricing behaviour, in particular competitively chosen, non-cooperative access prices at potentially asymmetric market equilibria.
    Keywords: Telecommunications, asymmetric access pricing
    JEL: L96 L51
    Date: 2006–12
  3. By: Michael Noel; Mark Schankerman
    Abstract: Strategic patenting is widely believed to raise the costs of innovating, especially in industriescharacterised by cumulative innovation. This paper studies the effects of strategic patentingon R&D, patenting and market value in the computer software industry. We focus on two keyaspects: patent portfolio size which affects bargaining power in patent disputes, and thefragmentation of patent rights (.patent thickets.) which increases the transaction costs ofenforcement. We develop a model that incorporates both effects, together with R&Dspillovers. Using panel data for the period 1980-99, we find evidence that both strategicpatenting and R&D spillovers strongly affect innovation and market value of software firms.
    Keywords: patents, anti-commons, patent thickets, R&D spillovers, market value
    JEL: L43 L86 O31 O32 O33 O34 O38
    Date: 2006–08
  4. By: Christian Hellwig
  5. By: Tobias Kretschmer; Katrin Muehlfeld
    Abstract: Firms faced with the decision of whether to standardize or not prior to introducing a newnetwork technology face a tradeoff: Compatibility improves the technology's chances ofconsumer acceptance, but it also means having to share the resulting profits with othersponsors of the standard. In this paper, we show that even prior to market introduction of anew technology, the timing of decisions is important and that firms have to weigh up thecooperative and competitive elements of pre-market choices. We also show that the option toprecommit to a technology before it is fully developed (as has been the case with theCompact Disc) can be profitable for network technologies.
    Keywords: Standardization, compact disc, preemption, war-of- attrition
    JEL: L63 O32
    Date: 2006–08
  6. By: Paul Conway; Giuseppe Nicoletti
    Abstract: Product market regulation in the non-manufacturing sectors of OECD countries: measurement and highlights This paper describes a new set of indicators that measure differences in the regulation of non-manufacturing sectors of OECD countries over the past three decades. The indicators focus on regulations that affect competitive pressures in areas where competition is economically viable and on the potential costs that these regulations entail for economic activities that use the output of regulated sectors as intermediate inputs in production. The paper illustrates the methodology used to compute the indicators and the patterns of product market regulation and regulatory reform that emerge from the analysis. The robustness of results is assessed in three ways: comparing the indicators to other available data covering the same areas; computing confidence intervals around the indicator values; and listing econometric results obtained by linking the indicators to measures of competition and economic performance. <P>Régulation des services dans les pays de l’OCDE : évaluation et traits saillants <BR>Régulation des services dans les pays de l’OCDE : évaluation et traits saillants Ce document décrit un nouvel ensemble d'indicateurs qui mesurent les différences dans la régulation des secteurs non-manufacturiels des pays de l'OCDE au cours de trois dernières décennies. Les indicateurs se concentrent sur les régulations qui influencent la pression concurrentielle dans les domaines d'activité économique où la concurrence est possible, ainsi que sur les coûts potentiels que ces régulations impliquent pour les activités économiques qui utilisent les produits des secteurs régulés comme biens intermédiaires. Le document illustre la méthodologie utilisée pour calculer les indicateurs ainsi que les profils de régulation et de réforme des marchés des biens qui émergent de l'analyse. La robustesse des résultats est vérifiée de trois façons: on compare les indicateurs à d'autres sources d'information concernant les même domaines d'analyse; on calcule des intervalles de confiance centrés sur les valeurs estimées des indicateurs; et on mentionne les résultats conometriques qui ont été obtenus par les nombreuses études qui ont exploité ces indicateurs pour examiner la relation entre l'intensité de la concurrence et la performance économique.
    Keywords: competition, services, services, regulation, concurrence, régulation, indicators, indicateurs
    JEL: L50 L91 L92 L93 L94 L95 L96 L98
    Date: 2006–12–07

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