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on Regulation |
| By: | Economides , Nicholas (Stern School of Business); Tåg, Joacim (Research Institute of Industrial Economics (IFN)) |
| Abstract: | We discuss the benefits of net neutrality regulation in the context of a two-sided market model in which platforms sell Internet access services to consumers and may set fees to content and applications providers "on the other side" of the Internet. When access is monopolized, we find that generally net neutrality regulation (that imposes zero fees "on the other side" of the market) increases total industry surplus compared to the fully private optimum at which the monopoly platform imposes positive fees on content and applications providers. Similarly, we find that imposing net neutrality in duopoly increases total surplus compared to duopoly competition between platforms that charge positive fees on content providers. We also discuss the incentives of duopolists to collude in setting the fees "on the other side" of the Internet while competing for Internet access customers. Additionally, we discuss how price and non-price discrimination strategies may be used once net neutrality is abolished. Finally, we discuss how the results generalize to other two-sided markets. |
| Keywords: | Net Neutrality; Two-sided Markets; Internet; Monopoly; Duopoly; Regulation; Discrimination |
| JEL: | C63 D40 D42 D43 L10 L12 L13 |
| Date: | 2008–01–15 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:0727&r=reg |
| By: | Osipian, Ararat |
| Abstract: | Corruption in higher education has long been neglected as an area of research in the US. The processes of decentralization, commoditization, and privatization in higher education rise questions of accountability, transparency, quality, and access. Every nation solves problems of access, quality, and equity differently. Thus, although prosecuting corruption in higher education is part of the legal process in every country, the ways in which legal actions are undertaken differ. This paper addresses the question: How is corruption in higher education understood and defined in legal cases, what particular cases receive more attention, and how these cases correlate with the major educational reforms, changes, and socio-economic context in the nation? Specifically, it analyses records of selected legal cases devoted to corruption in the US higher education. Decentralized financing of higher education anticipates cost sharing based in part on educational loans. The US higher education sector grows steadily, and so do opportunities for abuse, including in educational loans. The rapid expansion of education sector leaves some grey areas in legislation and raises issues of applicability of certain state and federal laws and provisions to different forms of misconduct, including consumer fraud, deception, bribery, embezzlement, etc. Higher Education Act, False Claims Act, and Consumer Protection Act cover corruption as related to the state and the public sector; corruption as related to client, business owner, and an agent; and corruption as related to consumer-business relations. However, the legal frame is simplistic, while the system of interrelations in the higher education industry is rather complex. |
| Keywords: | bribery; corruption; deception; fraud; higher education; law; loans; US |
| JEL: | I28 K42 I22 |
| Date: | 2007–11–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:8471&r=reg |
| By: | Clauio Borio |
| Abstract: | The unfolding financial turmoil in mature economies has prompted the official and private sectors to reconsider policies, business models and risk management practices. Regardless of its future evolution, it already threatens to become one of the defining economic moments of the 21st century. This essay seeks to provide a preliminary assessment of the events and to draw some lessons for policies designed to strengthen the financial system on a long-term basis. It argues that the turmoil is best seen as a natural result of a prolonged period of generalised and aggressive risk-taking, which happened to have the subprime market at its epicentre. In other words, it represents the archetypal example of financial instability with potentially serious macroeconomic consequences that follows the build-up of financial imbalances in good times. The significant idiosyncratic elements, including the threat of an unprecedented involuntary "reintermediation" wave for banks and the dislocations associated with new credit risk transfer instruments, are arguably symptoms of more fundamental common causes. The policy response, while naturally taking into account the idiosyncratic weaknesses brought to light by the turmoil, should be firmly anchored to the more enduring factors that drive financial instability. This essay highlights possible mutually reinforcing steps in three areas: accounting, disclosure and risk management; the architecture of prudential regulation; and monetary policy. |
| Keywords: | financial turmoil, risk, liquidity, prudential regulation, accounting, ratings, monetary policy |
| Date: | 2008–03 |
| URL: | http://d.repec.org/n?u=RePEc:bis:biswps:251&r=reg |
| By: | Horn, Henrik (Research Institute of Industrial Economics (IFN)); Mavroidis, Petros C. (Columbia Law School, New York) |
| Abstract: | The purpose of this paper is to report some initial findings based on the WTO Dispute Settlement Data Set (Ver. 2.0) that the authors have compiled for the World Bank. The data set contains approximately 28 000 observations on the workings of the Dispute Settlement (DS) system. It covers all 351 WTO disputes initiated through the official filing of a Request for Consultations from January 1, 1995, until October 25, 2006, and for these disputes it includes events occurring until December 31, 2006. Each dispute is followed through its legal life via the panel stage, the Appellate Body stage, through to the implementation stage. The descriptive statistics in the paper points to three observations. The first and obvious observation is the almost complete absence of least developed countries. Secondly, less poor developing countries are much more active, and much more successful than the authors would have expected. Third, the EU and the US dominate less than expected, being much more often the subject of complaints, than a complaining party, and they have a very low share of all panellists. |
| Keywords: | WTO; Dispute Settlement; Developing Countries |
| JEL: | F13 F53 O19 |
| Date: | 2008–04–21 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:0740&r=reg |
| By: | Surajeet Chakravarty; W. Bentley MacLeod |
| Abstract: | Economic models of contract typically assume that courts enforce obligations on the basis of verifiable events. As a matter of law, this is not the case. This leaves open the question of optimal contract design given the available remedies that are enforced by a court of law. This paper shows that standard form construction contracts can be viewed as an optimal solution to this problem. It is shown that a central feature of construction contracts is the inclusion of governance covenants that shape the scope of authority, and regulate the ex post bargaining power of parties. Our model also provides a unified framework for the study of the legal remedies of mistake, impossibility and the doctrine limiting damages for unforeseen events developed in the case of Hadley vs. Baxendale. |
| JEL: | D02 K12 L23 |
| Date: | 2008–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:13960&r=reg |
| By: | Matteo Rizzolli |
| Abstract: | Property law usually reacts to encroachments with ejectment. Building encroachments differ, as restoring landowner’s property claims implies the reversal of often large costs sustained by the builder. The authority faces thus the following dilemma: either it stands by the landowner and faces the social costs of undoing significant investments, or it defends the investment of the builder at the cost of neglecting landowner’s claims. To address building encroachments, national property laws have deployed interestingly different remedies that range from a property rule in favor of the landowner to a property rule in favor of the builder with a variety of liability rules in between. The paper models the builder-owner conflict after the theory of optional law (Ayres, 2005), it frames different national solutions into a common analytical setting and it evaluates the different laws in their relative allocative and distributive outcomes. Moreover the paper offers support to the idea that property law may implement put-option types of remedies. |
| Keywords: | building encroachments, adverse possession, comparative law and economics, property, land law, optional law, property rules, liability rules |
| JEL: | K11 |
| Date: | 2008–04 |
| URL: | http://d.repec.org/n?u=RePEc:mib:wpaper:136&r=reg |
| By: | Norbäck, Pehr-Johan (Research Institute of Industrial Economics (IFN)); Persson, Lars (Research Institute of Industrial Economics (IFN)) |
| Abstract: | We provide facts showing that in service markets: (i) restrictions on foreign direct investment (FDI) are under reform, (ii) cross-border Mergers & Acquisitions dominate as the entry mode of FDI, and (iii) there is often a high market concentration. Based on these facts, we present a model for analyzing cross-border M&A policy in liberalized service markets taking into account efficiency and market power effects. Our findings suggest that a merger policy, but not a discriminatory policy towards foreigners, seems warranted. Moreover, policies ensuring competition for domestic target firms seem warranted. In this vein, harmonization of the EU takeover regulations may particularly benefit assets owners in countries with many target firms. |
| Keywords: | Services; Mergers and Acquisitions; Investment Liberalization; Foreign Direct Investments; Ownership |
| JEL: | F23 K21 L13 O12 |
| Date: | 2008–04–08 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:0743&r=reg |