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on Contract Theory and Applications |
| By: | Javier Asensio Ruiz de Alda (Department of Applied Economics, Univ. Autonoma de Barcelona, 08193 Bellaterra, Spain); Anna Matas Prats (EDepartment of Applied Economics, Univ. Autonoma de Barcelona, 08193 Bellaterra, Spain) |
| Abstract: | Spain regulates its intercity bus market by means of a ‘competition for the market’ mechanism, whose design has been modified several times in the last years. This implies that current services are operated under contracts whose conditions are heterogeneous. We take advantage of such fact to empirically measure the impact that regulatory designs may have on fares paid by the users. The results show very large differences between routes whose contracts were awarded under relatively open conditions compared to regionally regulated routes or very old contracts whose concessions were extended and have not been retendered. |
| Keywords: | intercity buses, prices, tendering, competition for the market. |
| Date: | 2022–01 |
| URL: | http://d.repec.org/n?u=RePEc:uab:wprdea:wpdea2201&r= |
| By: | Thomas Schneider; Philip Strahan; Jun Yang |
| Abstract: | Relative performance evaluation (RPE) intensifies competitive pressure by tying executive compensation to the profits of rivals. We show that these contracts make loan syndication harder by reducing banks’ willingness to participate in loans underwritten by banks named in their RPE contracts. Lead arranger banks which are more frequently named in RPE hold larger shares of the loans they syndicate, and their borrowers face higher spreads. These banks, in turn, lose market share to banks less likely to be named in RPE. Our results highlight the tension between the normal benefits of competition versus the need for cooperation in loan syndication. |
| JEL: | G20 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:29859&r= |
| By: | Juan J. Dolado; Etienne Lalé; Helene Turone |
| Abstract: | We propose a model to evaluate the U.K.’s zero-hours contract (ZHC) – a contract that exempts employers from the requirement to provide any minimum working hours, and allows workers to decline any workload. We find quantitatively mixed welfare effects of ZHCs. On one hand they unlock job creation among firms that face highly volatile business conditions and increase laborforce participation of individuals who prefer flexible work schedules. On the other hand, the use ofZHCs by less volatile firms, where jobs are otherwise viable under regular contracts, reduces welfare and likely explains negative employee reactions to this contract. |
| Date: | 2022–03–31 |
| URL: | http://d.repec.org/n?u=RePEc:bri:uobdis:22/763&r= |
| By: | Clavijo, R |
| Abstract: | This work develops a competition model between two asymmetrical networks with calling circles, allowing subscribers to derive utility by receiving calls. Unlike the traditional literature predictions, in equilibrium firms have strategies to set off-net price below on-net price. In markets where consumers display strongly concentrated calling patterns, firms can only extract limited surplus from off-net calls. This is reinforced if consumers display weak call externalities, languishing the price strategies to discourage off-net calls. Furthermore, regulating price differential of the large firm can lead consumers to face higher fees compared to discriminatory setting. Therefore, regulators should broaden efforts to measure call externalities and calling circles strength before making decisions on retail tariff regulation. |
| Keywords: | Calling circles; Call externalities; Network competition; Price differentials. |
| JEL: | D43 D62 L14 |
| Date: | 2022–04–08 |
| URL: | http://d.repec.org/n?u=RePEc:col:000092:020054&r= |