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on Network Economics |
| By: | Iwasa, Kazumichi; Kikuchi, Toru |
| Abstract: | Indirect network effects exist when the utility of consumers is increasing in the variety of complementary software products available for use with an electronic hardware device. In this study, we examine how trade liberalization affects production structure in the presence of indirect network effects. For these purposes we construct a simple two-country model of trade with two incompatible hardware technologies. It is shown that, given that both types of hardware exist before trade liberalization, liberalization may reduce the variety of hardware technology via intensified network effects. It is also shown that, contrary to the findings of previous studies, some consumers may become worse off as the result of trade. In other words, trade liberalization,which forms the basis for a greater variety of software products, may work as a catalyst for excess hardware standardization. |
| Keywords: | Indirect Network Effects; Trade Liberalization |
| JEL: | F12 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:4399&r=net |
| By: | Yu, W.; Jamasb, T.; Pollitt, M. |
| Abstract: | Efficiency analysis of electricity distribution networks is often limited to technical or cost efficiency measures. However, some important non-tradable aspects of their service such as quality of service and network energy losses are generally not part of the analysis. A regulatory concern is that technical efficiency can be achieved at the expense of these measures as well as allocative efficiency. Valuation of service quality for inclusion in regulatory models is particularly difficult. This paper presents an approach to measure and incorporate service quality and energy losses in analysis of technical and allocative efficiency of the utilities. We calculate technical and allocative efficiency of the 14 distribution networks in the UK between 1990/91 and 2003/04 using the Data Envelopment Analysis technique. We find that efficiency measures improved during the first (1990/91-1994/95) and second (1995/96-1999/00) distribution price control reviews and exhibited a slight decline during the third (2000/01-2004/05) review period. We find relatively low allocative efficiency - i.e. a mismatch in allocating resources among expenditures, service quality, and energy losses. The results suggest that the utilities may not be sufficiently incentivised to achieve socially optimal input bundles under the current incentive scheme. Key words: Data Envelopment Analysis, electricity, quality of service, willingness-to-pay |
| JEL: | L15 L51 L94 |
| Date: | 2007–07 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:0736&r=net |
| By: | Carbonai, Davide; Di Bartolomeo, Giovanni |
| Abstract: | This paper investigates the market structure of the insurance business by analyzing the (interlock) linkages among companies created by their directors. We focus on the non-life business since this is a sector relatively closed with respect to the competition with other financial activities; an absence of industry competition cannot thus be compensated by other agents. We apply the graph theory to describe the network and the principal component analysis to summarize information and verify the correlation between direct interlocking and companies’ market shares. |
| Keywords: | Non-life insurance; antitrust; competition; interlocking directorates; network economics. |
| JEL: | K23 K21 K0 |
| Date: | 2006–11 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:4420&r=net |
| By: | Lisa Callegaro (Department of Economics, University Of Venice Cà Foscari); Giacomo Pasini (Department of Economics, University Of Venice Cà Foscari; Economics and Organization, School for Advanced Studies in Venice) |
| Abstract: | We study jointly the health perception of the elderly and the care giving decision of their adult children. Social interactions play a crucial role: elder parents' health perception depends on relations with household members. On the other hand adult children make their care giving decisions strategically, meaning that each of them considers his siblings' decision. We find empirical evidence which support this claim using the 2004 wave of the SHARE survey. We estimate social interaction effects by means of methods taken from the spatial econometric literature. Health perception relation with care giving depends on the determinants of adult children's decision to care: Parents' health may be modelled as a common good for parents and children; the latter's decision may be driven by bequest motives or by pure altruism and/or cultural values. We test implications of the model thanks to the unique features of the SHARE dataset: it is trans--national, allowing to control for cultural and institutional differences, it contains information on health status of over-50 Europeans and details on their social and intergenerational relations. |
| Keywords: | Insurance, Social SHARE, care giving, social interactions, health, aging |
| JEL: | L26 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:ven:wpaper:10_07&r=net |