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on Law and Economics |
| By: | Massimo Motta; Martin Peitz |
| Abstract: | The proposal to relax EU merger control to allow for anti-competitive 􀇲European Champions􀇳 may lead policy makers to update current merger control. While we see little merit in this specific proposal, we recommend a revision that goes into a different direction and, in particular, addresses mergers of potential competitors and the burden of proof. Thus, our proposal aims at the EC addressing problems of under-enforcement and making better-informed decisions. However, we would find it sensible to introduce in the Merger Regulation a clause whereby in exceptional and well-defined cases a merger, which would otherwise pass muster on competition grounds, may be prohibited due to defence, strategic and security of supply considerations. |
| Keywords: | Merger policy, European Union, potential competitor, safe harbour, national champion |
| JEL: | K21 L41 L52 |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:bon:boncrc:crctr224_2019_077&r=all |
| By: | Dmitry Y. Poldnikov (National Research University Higher School of Economics) |
| Abstract: | Comparative legal studies have established themselves as the reaction of legal scholarship towards the legal diversity of our shrinking world today and in the past. Despite their potential, such studies occupy a marginal place in legal curricula and practice across Europe. This unhappy situation has brought about debates within the community of comparatists about possible causes and eventual remedies. In this paper, I look at this debate as the incarnation of the century-long confrontation among 'erudite' and 'pragmatic' legal scholars; the former group identify with the agenda of Rodolfo Sacco and the latter are led by Basil Markesinis. My aim is to draw implications from this debate for comparative legal history. In order to do so, I begin by introducing the main tenants of the two 'schools'. Secondly, I investigate the main stumbling blocks of the debate between them: Eurocentrism, the selective scope of research, interdisciplinary and cultural studies. Thirdly, I contemplate the implications of the debate for legal history and a possible synthesis of the two approaches suggested by Uwe Kischel. My main point here is to encourage legal historians in two respects: (1) to engage in cooperation with comparatists in order to enhance our understanding of the context(s) and the paradigm(s) of European legal culture in the face of the ongoing internationalisation of law and legal studies and, (2) to pursue the task of revealing the hidden factors that slow down the transformation of positive law when the changing world calls for it, as is the case with acknowledging new kinds of legal subjects |
| Keywords: | comparative legal history, legal scholarship, methodology, post-modern cultural studies, Eurocentrism, contextual comparison, hidden legal formants |
| JEL: | Z |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:hig:wpaper:88/law/2019&r=all |
| By: | Adriana Breccia (Risk Control Limited, London) |
| Abstract: | Numerous studies have examined how market structure affects appropriability of R&D returns and, in turn, R&D investment and innovation speed. Less effort has been spent on the opposite relationship which is instead our focus. In a continuous time model, two firms compete in R&D, with the leading patent affecting the probability of success of a second patent (competing in the same product market); the size and the direction of this effect depends on the level of appropriability, which, unlike previous research, connects competition in R&D and competition in the product market. We find that low appropriability delays R&D investments and thus discovery, with the (future) benefit of a more competitive product market. Secondly, we show that the relation between concentration in R&D and concentration in product markets can be positive or negative depending on the probability of success of an innovation and its level of appropriability. Also, we find that an increase in the probability of success of innovation does not necessarily speed up investment in R&D. |
| Keywords: | real options, intellectual property, R&D, geometric Brownian motion, Stackelberg games |
| JEL: | C7 D8 O3 K4 |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:bbk:bbkefp:1902&r=all |
| By: | Meyer, Brett; Biegert, Thomas |
| Abstract: | Recent work in labor economics has shown that technological change has induced labor market polarization, an increase in demand for both high and low skill jobs, but declining demand for middle skill routine task jobs. We argue that labor market polarization should affect firms’ participation in collective agreements, but only in countries where laws automatically extending collective agreements to nonparticipating firms are weak. We develop an argument in which labor market polarization increases the distance between different skill groups of workers in both preferences for unionization and leverage to realize those preferences. Because of this, an increase in labor market polarization should be associated with a decline in collective bargaining coverage. We test our hypothesis about collective agreement extension and collective bargaining coverage in a cross-national sample of 21 Organisation for Economic Co-operation and Development countries from 1970 to 2010 and our hypothesis about labor market polarization in German firm-level and industry-level data from 1993–2007. We find a negative relationship in the Organisation for Economic Co-operation and Development sample between technological change and collective bargaining coverage only in countries that make little or no use of extension procedures. We find that higher workforce skill polarization is associated with lower collective agreement participation in both German firm-level and industry-level samples. |
| Keywords: | Germany; labor market polarization; Technological change; trade unions |
| JEL: | R14 J01 |
| Date: | 2019–02–07 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:100305&r=all |
| By: | Barlow, Pepita; Reeves, Aaron; McKee, Martin; Stuckler, David |
| Abstract: | Sociologists have long acknowledged that being in a precarious labour market position, whether employed or unemployed, can harm peoples' health. However, scholars have yet to fully investigate the possible contextual, institutional determinants of this relationship. Two institutions that were overlooked in previous empirical studies are the regulations that set minimum compensation for dismissal, severance payments, and entitlements to a period of notice before dismissal, notice periods. These institutions may be important for workers' health as they influence the degree of insecurity that workers are exposed to. Here, we test this hypothesis by examining whether longer notice periods and greater severance payments protect the health of labour market participants, both employed and unemployed. We constructed two cohorts of panel data before and during the European recession using data from 22 countries in the European Union Statistics on Income and Living Conditions (person years = 338,000). We find more generous severance payments significantly reduce the probability that labour market participants, especially the unemployed, will experience declines in self-reported health, with a slightly weaker relationship for longer notice periods. |
| Keywords: | dismissal legislation; health; insecurity; institutions; job loss; precariousness |
| JEL: | R14 J01 |
| Date: | 2019–02–14 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:100359&r=all |
| By: | Andrea Caponera (Bank of Italy); Carlo Gola (Bank of Italy) |
| Abstract: | TIn this study, we investigate the economic characteristics of bitcoin and similar crypto-assets. Following an introduction to the blockchain protocol, the role of exchanges and of digital wallet providers, we consider the regulatory measures adopted in various jurisdictions. Lastly, we examine the accounting and prudential aspects related to crypto-assets, of which significant uncertainties still remain. The paper provides a taxonomy of crypto-assets, and describes the basic features of the initial coin offerings (ICOs) and related aspects. The literature shows that bitcoin, and similar crypto-assets, do not fully fall within the category of money and financial instruments. This class of digital tokens, based on a permissionless distributed ledger technology (DLT), is highly volatile and absent of intrinsic value. The instability of their price, which is often undetermined, must be considered when evaluating these instruments from an accounting and prudential standpoint. |
| Keywords: | bitcoin, crypto-assets, blockchain, digital tokens, initial coin offerings, exchanges |
| JEL: | E40 E42 E51 G21 G28 K20 M40 |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:bdi:opques:qef_484_19&r=all |
| By: | Bataille, Marc; Bodnar, Olivia; Steinmetz, Alexander; Thorwarth, Susanne |
| Abstract: | While markets have been liberalized all over the world, incumbents often still hold a dominant position, e.g. on energy markets. Thus, wholesale electricity markets are subject to market surveillance. Nevertheless, consolidated findings on abusive practices of market power and their cause and effect in these markets are scarce and non-controversial market monitoring practices fail to exist. Right now, the Residual Supply Index (RSI) is the most important instrument for market monitoring. However, a major drawback of this index is its focus on just one specific aspect of market power in wholesale electricity markets whereas different consequences of market power are possible. Hence, markets could be distorted in several ways and we propose the 'Return on Withholding Capacity Index' (RWC) as a complementary index to the RSI. The index is a measure of the firms' incentive to withhold capacity. The benefits and practicability of the RWC is shown by an application on data for the German-Austrian electricity wholesale market in 2016. |
| Keywords: | Market Power,Electric Power Markets,Residual Supply Index |
| JEL: | L11 L43 L94 K23 C13 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:dicedp:311&r=all |
| By: | Adrien Auclert; Will S. Dobbie; Paul Goldsmith-Pinkham |
| Abstract: | This paper argues that the debt forgiveness provided by the U.S. consumer bankruptcy system helped stabilize employment levels during the Great Recession. We document that over this period, states with more generous bankruptcy exemptions had significantly smaller declines in non-tradable employment and larger increases in unsecured debt write-downs compared to states with less generous exemptions. We interpret these reduced form estimates as the relative effect of debt relief across states, and develop a general equilibrium model to recover the aggregate employment effect. The model yields three key results. First, substantial nominal rigidities are required to rationalize our reduced form estimates. Second, with monetary policy at the zero lower bound, traded good demand spillovers across states boosted employment everywhere. Finally, the ex-post debt forgiveness provided by the consumer bankruptcy system during the Great Recession increased aggregate employment by almost two percent. |
| JEL: | D14 E32 K35 |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:25685&r=all |