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on Industrial Organization |
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Issue of 2014‒08‒16
four papers chosen by |
| By: | Patrice Bougette (University of Nice Sophia Antipolis, France; GREDEG CNRS); Marc Deschamps (University of Nice Sophia Antipolis, France; GREDEG CNRS; BETA CNRS); Frédéric Marty (GREDEG CNRS; University of Nice Sophia Antipolis; OFCE - Sciences Po. Paris) |
| Abstract: | In this article, we use a history of economic thought perspective to analyze the process by which the Chicago School of Antitrust emerged in the 1950s and became dominant in the US. We show the extent to which economic objectives and theoretical views shaped antitrust laws in their inception. After establishing the minor influence of economics in the promulgation of U.S. competition laws, we then highlight U.S. economists' very cautious views about antitrust until the Second New Deal. We analyze the process by which the Chicago School developed a general and coherent framework for competition policy. We rely mainly on the seminal and programmatic work of Director and Levi (1956) and trace how this theoretical paradigm was made collective, i.e. the 'economization' process took place in US antitrust. Finally, we discuss the implications, if not the possible pitfalls, of such a conversion to economics-led competition law enforcement. |
| Keywords: | Antitrust, Chicago School, Consumer welfare, Efficiency, Monopolization |
| JEL: | K21 L40 |
| Date: | 2014–07 |
| URL: | http://d.repec.org/n?u=RePEc:gre:wpaper:2014-23&r=ind |
| By: | Pedro Bento (West Virginia University, College of Business and Economics) |
| Abstract: | I incorporate an insight of Friedrich Hayek - that competition allows a thousand flowers to bloom, and discovers the best among them - into a model of Schumpeterian innovation. Firms face uncertainty about the optimal direction of innovation, so more innovations implies a higher expected value of the `best' innovation. The model accounts for two seemingly contradictory relationships reported in recent empirical studies - a positive relationship between competition and industry-level productivity growth, and an inverted-U relationship between competition and firm-level innovation. Notwithstanding the positive relationship between competition and growth, I find antitrust policy reduces industry-level growth. |
| Keywords: | competition, innovation, productivity growth, inverted-u, antitrust, regulation |
| JEL: | O31 O40 L41 L51 |
| Date: | 2013–08 |
| URL: | http://d.repec.org/n?u=RePEc:wvu:wpaper:13-10&r=ind |
| By: | M. Cecilia Bustamante; Andrés Donangelo |
| Abstract: | This paper shows that product market competition has two opposing effects on asset returns. The first relates to the procyclical nature of the value destruction from expansion of competitors, which lowers exposure to systematic risk in more competitive industries. The second is related to the narrower profit margins due to competition, which increase exposure to systematic risk. We find that the first effect dominates the second, so that firms in more competitive industries generally earn lower asset returns. Our results are robust to using five alternative measures of competition and to controlling for the sample selection bias of publiclylisted firms. |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:fmg:fmgdps:dp728&r=ind |
| By: | Pussep, Anton; Schief, Markus; Weiblen, Tobias; Leimbach, Timo; Peltonen, Juhana; Rönkkö, Mikko; Buxmann, Peter |
| Abstract: | This is the second year that we execute the Software Industry Survey in Germany and publish a report with the main results. As formulated in 2012, our goal is to investigate the current state of the German software industry on a yearly basis. Conclusions are made based on grounded data and empirical findings. We hope that this type of research will contribute to the work of both, practitioners and researchers. |
| Date: | 2013–08–12 |
| URL: | http://d.repec.org/n?u=RePEc:dar:wpaper:62971&r=ind |