nep-ind New Economics Papers
on Industrial Organization
Issue of 2014‒10‒13
six papers chosen by
Kwang Soo Cheong
Johns Hopkins University

  1. Sequential Product Innovation, Competition and Patent Policy By George Norman; Lynne Pepall; Dan Richards
  2. The Limits of Price Discrimination By Dirk Bergemann; Benjamin Brooks; Stephen Morris
  3. A Utility-Based Model of Sales with Informative Advertising By Sandro Shelegia; Chris M. Wilson
  4. Unbundling the incumbent: Evidence from UK broadband By Mattia Nardotto; Tommaso Valletti; Frank Verboven
  5. Firms' Size and Productivity in Spain: a Stochastic Frontier Analysis By Rosario Sanchez; Maria Angeles Diaz
  6. Market Power and Collusion on Interconnection Phone Market in Tunisia: What Lessons from International Experiences By Sami DEBBICHI; Walid HICHRI

  1. By: George Norman; Lynne Pepall; Dan Richards
    Abstract: This paper examines the role of patent policy in a spatial model of sequential innovation. Initial entrepreneurs develop a new product market and anticipate that subsequent innovation may lead to a product line that consumers value more highly. The likelihood of sequential innovation increases with the number of initial early entrants in the market. Patent protection that encourages early entry can therefore raise the probability of both initial and subsequent innovation. We determine the optimal patent breadth as a function of key industry characteristics of both consumer taste and the new technology.
    Keywords: sequential innovation, patent policy, entry
    JEL: L5 O25
    URL: http://d.repec.org/n?u=RePEc:tuf:tuftec:0786&r=ind
  2. By: Dirk Bergemann (Cowles Foundation, Yale University); Benjamin Brooks (Dept. of Economics, Princeton University); Stephen Morris (Dept. of Economics, Princeton University)
    Abstract: We analyze the welfare consequences of a monopolist having additional information about consumers' tastes, beyond the prior distribution; the additional information can be used to charge different prices to different segments of the market, i.e., carry out "third degree price discrimination." We show that the segmentation and pricing induced by the additional information can achieve every combination of consumer and producer surplus such that: (i) consumer surplus is non-negative, (ii) producer surplus is at least as high as profits under the uniform monopoly price, and (iii) total surplus does not exceed the surplus generated by efficient trade.
    Keywords: First degree price discrimination, Second degree price discrimination, Third degree price discrimination, Private information, Privacy, Bayes correlated equilibrium, Concavification
    JEL: C72 D82 D83
    Date: 2013–05
    URL: http://d.repec.org/n?u=RePEc:cwl:cwldpp:1896rrr&r=ind
  3. By: Sandro Shelegia; Chris M. Wilson
    Abstract: This paper presents a generalised framework to understand mixed-strategy sales behaviour with informative advertising. By introducing competition in the utility space into a clearinghouse sales model, we oer a highly tractable framework that can i) provide a novel welfare analysis of intra-personal price discrimination in sales markets, ii) characterise sales in a range of new contexts including complex market settings and situations where rms conduct sales with two-part taris or non-price variables such as package size, and iii) synthesise past research and highlight its key forces and assumptions.
    JEL: L13 D43 M37 D83
    Date: 2014–09
    URL: http://d.repec.org/n?u=RePEc:vie:viennp:1406&r=ind
  4. By: Mattia Nardotto (University of Cologne); Tommaso Valletti (Imperial College London, University of Rome “Tor Vergata” & CEPR); Frank Verboven (KU Leuven, Telecom ParisTech and CEPR)
    Abstract: We consider the impact of a regulatory process forcing an incumbent telecom operator to make its local broadband network available to other companies (local loop unbundling, or LLU). Entrants are then able to upgrade their individual lines and offer Internet services directly to customers. Employing a very detailed dataset covering the whole of the UK, we find that, over the course of time, many entrants have begun to take advantage of unbundling. LLU entry only had a positive effect on broadband penetration in the early years, and no longer in the recent years as the market reached maturity. In contrast, LLU entry continues to have a positive impact on the quality of the service provided, as entrants differentiate their products upwards compared to the incumbent. We also assess the impact of competition from an alternative form of technology (cable) which is not subject to regulation, and what we discover is that inter-platform competition has a positive impact on both penetration and quality.
    Keywords: regulation, competition, entry, telecommunications, broadband, local loop unbundling
    JEL: D22 K23 L43 L51 L96
    Date: 2014–10–03
    URL: http://d.repec.org/n?u=RePEc:rtv:ceisrp:331&r=ind
  5. By: Rosario Sanchez; Maria Angeles Diaz
    URL: http://d.repec.org/n?u=RePEc:ekd:002721:272100076&r=ind
  6. By: Sami DEBBICHI; Walid HICHRI
    Abstract: We try in this paper to characterize the state of mobile phone market in Tunisia. Our study is based on a survey of foreign experience (Europe) in detecting collusive behavior and a comparison of the critical threshold of collusion between operators in developing countries like Tunisia. The market power is estimated based on the work of Parker Roller (1997) and the assumption of "Balanced Calling Pattern". We use then the model of Friedman (1971) to compare the critical threshold of collusion. We show that the “conduct parameter” measuring the intensity of competition is not null during the period 1993-2011. Results show also that collusion is easier on the Tunisian market that on the Algerian, Jordanian, or Moroccan one.
    Keywords: Termination rate; Market power; Competition; Mobile phone Market.
    JEL: D41 L96 L71
    Date: 2014–09–25
    URL: http://d.repec.org/n?u=RePEc:ipg:wpaper:2014-580&r=ind

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