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on Regulation |
| By: | Baake, Pio (DIW Berlin); Sudaric, Slobodan (HU Berlin) |
| Abstract: | We analyze competition between Internet Service Providers (ISPs) where consumers demand heterogeneous content within two Quality-of-Service (QoS) regimes, Net Neutrality and Paid Prioritization, and show that paid prioritization increases the static efficiency compared to a neutral network. We also consider paid prioritization intermediated by Content Delivery Networks (CDNs). While the use of CDNs is welfare neutral, it results in higher consumer prices for internet access. Regarding incentives to invest in network capacity we show that discriminatory regimes lead to higher incentives than the neutral regime as long as capacity is scarce, while investment is highest in the presence of CDNs. |
| Keywords: | content delivery network; investment; net neutrality; prioritization; |
| JEL: | L13 L51 L96 |
| Date: | 2018–06–25 |
| URL: | http://d.repec.org/n?u=RePEc:rco:dpaper:102&r=reg |
| By: | Stefano Galavotti (University of Padova); Luigi Moretti (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique); Paola Valbonesi (University of Padova) |
| Abstract: | We study bidding behavior by firms in beauty-contest auctions, i.e. auctions in which the winning bid is the one which gets closet to some function (average) of all submitted bids. Using a dataset on public procurement beauty-contest auctions, we show that firms' observed bidding behavior departs from equilibrium and can be predicted by a sophistication index, which captures the firms' accumulated capacity of bidding close to optimality in the past. We show that our empirical evidence is consistent with a Cognitive Hierarchy model of bidders' behavior. We also investigate whether and how firms learn to bid strategically through experience. |
| Keywords: | cognitive hierarchy,auctions,beauty-contest,public procurement |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-01440891&r=reg |
| By: | Saglam, Ismail |
| Abstract: | In this paper, we study how a monopolistic firm with unknown costs may behave under the threat of regulation. To this aim, we integrate the self-regulation model of Glazer and McMillan (1992) with the optimal regulatory mechanism devised by Baron and Myerson (1982) for the case of asymmetric information. Simulating the equilibrium outcome of our integrated model for a wide range of parameter values, we show that the firm threatened with regulation always constrains its price; moreover, it does so more stringently if it is less efficient. If the marginal cost of the firm is sufficiently close to the highest possible value according to the beliefs of the legislators and the regulator, the price the firm charges under the threat of regulation can be even lower than the price it has to charge when it is regulated. Our simulations also reveal how the welfares of consumers and the threatened firm may be affected in the short-run and long-run by possible variations in several attributes of our model, involving the marginal cost of production, the number of legislators, each legislator's cost of proposing a regulatory bill, the size of the market, and the weight of the firm's welfare in the social welfare function. |
| Keywords: | Monopoly; regulation; self-regulation; asymmetric information. |
| JEL: | D42 D82 L51 |
| Date: | 2018–06–03 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:87151&r=reg |
| By: | Blum, Bianca; Hübner, Julian; Müller, Sarah; Neumärker, Karl Justus Bernhard |
| Abstract: | [Introduction ...] This paper explores the factors that influence the emergence and extent of rebound effects and the challenges that arise for a sustainable environmental policy. The focus here is on increasing energy efficiency and the energy consumption decisions on the consumer side. The starting point of this investigation is the concept of the rebound effect, whose definition is based on the most common classification in the much-cited works by Greening et. al. (2000) and Berkhout et. al. (2000). Based on this, the main part of this paper is dedicated to the different factors influencing the rebound effect. The last section addresses the challenges arising for an environmental policy to promote energy efficiency. |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:cenwps:022018&r=reg |
| By: | Luisa Dressler; Tibor Hanappi; Kurt van Dender |
| Abstract: | This paper shows that corporate tax provisions can lead to different effective tax rates (ETRs) if there is a capital cost-intensive and a variable cost-intensive way of producing the same output. It develops a framework for analysing sources of the difference in ETRs and adapts existing models to compare forward-looking ETRs for low-carbon and high-carbon electricity generation technologies, considering tax provisions for cost recovery in 36 countries. It finds that standard tax systems are technology neutral when investments are debt-financed because the deductibility of interest payments compensates for the fact that capital allowances are based on nominal (rather than real) capital costs. Under equity finance, ETRs are higher for investments in capital-cost-intensive technologies as the cost of equity finance is often not deductible. Since low-carbon electricity generation tends to be relatively capital-intensive, this result represents a form of unintentional misalignment of the corporate tax system with decarbonisation objectives,. |
| Keywords: | corporate taxation, cost structure, electricity generation, low-carbon transition, technology choice |
| JEL: | G11 H25 O14 Q48 |
| Date: | 2018–07–19 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ctpaaa:37-en&r=reg |
| By: | Audinga Baltrunaite (Banca d'Italia); Cristina Giorgiantonio (Banca d'Italia); Sauro Mocetti (Banca d'Italia); Tommaso Orlando (Banca d'Italia) |
| Abstract: | Public procurement outcomes depend on the ability of the procuring agency to select high-performing suppliers. Should public administrations be granted more or less discretion in their decision making? Using Italian data on municipal public works tendered in the period 2009-2013, we study how a reform extending the scope of bureaucrat discretion affects supplier selection. We find that the share of contracts awarded to firms having a local politician among its administrators or shareholders increases, while the (ex-ante) labor productivity of the winning firms decreases, thus suggesting a potential misallocation of public funds. These effects are concentrated among lower quality procurement agencies. |
| Keywords: | discretion, supplier selection, public procurement, transparency, corruption |
| JEL: | D72 D73 H57 P16 |
| Date: | 2018–06 |
| URL: | http://d.repec.org/n?u=RePEc:bdi:wptemi:td_1178_18&r=reg |