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on Industrial Organization |
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Issue of 2021‒08‒30
nine papers chosen by |
| By: | John Asker; Volker Nocke |
| Abstract: | This survey examines recent developments in economic research relating to antitrust, paying specific attention to research in the areas of collusion and merger enforcement. Research relating to both collusion and mergers has made significant advances in the last twenty years. With respect to collusion, this includes important theoretical and empirical work on the sustainability, structure, and impact of collusive schemes. With respect to mergers, this includes important work on the impact of enforcement institutions, both theoretical and empirical work on unilateral effects, and theoretical work on the selection of which mergers get proposed to antitrust agencies and optimal policy in the face of that selection. A feature of recent research is the increasing complementarity between empirical work (ranging from observational studies to model-based measurement) and theoretical work in advancing our understanding of collusive and merger-related phenomena. |
| JEL: | K21 L4 |
| Date: | 2021–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:29175&r= |
| By: | Stefan Buehler; Nicolas Eschenbaum |
| Abstract: | This paper studies dynamic monopoly pricing for a broad class of Coasian and Non-Coasian settings. We show that the driving force behind pricing dynamics is the seller's incentive to trade up consumers to higher-valued consumption options. In Coasian settings, consumers can be traded up from the static optimum, and pricing dynamics arise until all trading-up opportunities are exhausted. In Non-Coasian settings, consumers cannot be traded up from the static optimum, and no pricing dynamics arise. Hence, dynamic monopoly pricing can be characterized by checking for trading-up opportunities in the static optimum. |
| Date: | 2021–08 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2108.07146&r= |
| By: | Stadler, Manfred; Tobler Trexler, Céline; Unsorg, Maximiliane |
| Abstract: | Compatibility of network products is an important issue in markets for communication technology as well as hard- and software products. Empirical findings suggest that firms competing in these markets typically choose intermediate degrees of product compatibility. We present a strategic two-stage game of two firms deciding strategically or commonly on the degree of product compatibility in the first stage and on prices in the second stage. Indeed, partial compatibility constitutes a subgame perfect Nash equilibrium when coordination costs of standardization are high and the installed bases are low. |
| Keywords: | Compatibility,Network Products,Network Effects |
| JEL: | C72 L13 L15 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:tuewef:150&r= |
| By: | Rey, Patrick; Nocke, Volker |
| Abstract: | We consider a multiproduct seller facing consumers who must search to learn prices and valuations. The equilibrium features choice overload: the larger the product line, the fewer consumers start searching. We provide conditions under which the seller o¤ers too much or too little variety. We then allow the seller to position products or make recommendations, thereby introducing the possibility of directed search, and show that the seller may .nd it pro.table to maintain some noise. Finally, we study the seller.s incentive to disclose product identity and extend our analysis to that of a platform choosing which sellers to host. |
| Keywords: | Sequential consumer search; product variety; choice overload; multi-product firm; platform |
| JEL: | L12 L15 D42 |
| Date: | 2021–08–24 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:125850&r= |
| By: | NES Kjersti (European Commission - JRC); COLEN Liesbeth; CIAIAN Pavel (European Commission - JRC) |
| Abstract: | This report provides an overview of various market power indicators within the food industry in selected Member States (MS) in the EU. In addition, the report aims to examine whether the alternative market power indicators are qualitatively comparable proxies to measure market power in the food industry and to discuss the potential implications for the EU’s directive on unfair trading practices (UTPs). The report analyses the market power in-depth for the year 2016 and studies its dynamics over the period 2006-2017 in the selected MS. The report considers four alternative measures of market power: the concentration ratio (CR4), the Herfindahl-Hirschman Index (HHI), markups as well as turnover size, which is the market power measure used in the EU’s UTP directive. The report analyses are based on the firm-level accounting data available from the Orbis database. Due to limited data availability in some countries, the report considers 10 MS for calculation of the CR4, HHI and turnover indicator, and 7 MS for estimation of markups. The analyses are carried out for different (more aggregated) sectors of the food industry—i.e., retail, wholesale and manufacturing—, as well as for disaggregated subsectors within the wholesale and manufacturing sectors. |
| Keywords: | food chain, unfair trading practices (UTP), market power |
| Date: | 2021–07 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc125087&r= |
| By: | Jan Bena; Isil Erel; Daisy Wang; Michael S. Weisbach |
| Abstract: | Inducing firms to make specialized investments through bilateral contracts can be challenging because of potential hold- up problems. Such contracting difficulties have long been argued to be an important reason for acquisitions. To evaluate the extent to which this motivation leads to mergers, we perform a textual analysis of the patents filed by the same lead inventors of the target firms before and after the mergers. We find that patents of inventors from target firms become 28.9% to 46.8% more specific to those of acquirers’ inventors following completed mergers, benchmarked against patents filed by targets and a group of counterfactual acquirers. This pattern is stronger for vertical mergers that are likely to require specialized investments. There is no change in the specificity of patents for mergers that are announced but not consummated. Overall, we provide empirical evidence that contracting issues in motivating specialized investment can be a motive for acquisitions. |
| JEL: | G34 L14 L22 |
| Date: | 2021–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:29174&r= |
| By: | Chenarides, Lauren; Gomez, Miguel I.; Richards, Timothy J.; Yonezawa, Koichi |
| Keywords: | Marketing, Agribusiness, Production Economics |
| Date: | 2021–08 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aaea21:312706&r= |
| By: | Hughes, Megan N.; Ma, Meilin; Mallory, Mindy L.; O'Connor, Kylie |
| Keywords: | Agricultural and Food Policy, Risk and Uncertainty, Marketing |
| Date: | 2021–08 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aaea21:312803&r= |
| By: | Lukasz Grzybowski; Ángela Munoz-Acevedo |
| Abstract: | We empirically assess the impact of the EU roaming regulation on mobile operators’ average revenues per user (ARPU) and retail prices. Using a differences-in-difference approach, hedonic price regressions and detailed operator and plan-level data we find that the regulation decreased mobile operator’s revenues per user, while it had no impact on tariffs during the latest phase of the regulation. |
| Keywords: | roaming, mobile telecommunications, regulation |
| JEL: | L13 L50 L96 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9235&r= |