|
on Regulation |
| By: | Marleen Marra (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | This paper presents, solves, and estimates the first structural auction model with seller selection. This allows me to quantify network effects arising from endogenous bidder and seller entry into auction platforms, facilitating the estimation of theoretically ambiguous fee impacts by tracing them through the game. Relevant model primitives are identified from variation in second-highest bids and reserve prices. My estimator builds off the discrete choice literature to address the double nested fixed point characterization of the entry equilibrium. Using new wine auction data, I estimate that this platform's revenues increase up to 60% when introducing a bidder discount and simultaneously increasing seller fees. More bidders enter when the platform is populated with lower-reserve setting sellers, driving up prices. Moreover, I show that meaningful antitrust damages can be estimated in a platform setting despite this two-sidedness. |
| Keywords: | Auctions with entry,Two-sided markets,Nonparametric identification,Estimation,Nested fixed point |
| Date: | 2019–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-03393068&r= |
| By: | Anna Alberini (AREC, University of Maryland, College Park & Charles University, Prague, Czech Republic); Levan Bezhanishvili (Charles University, Prague, Czech Republic); Milan Scasny (Charles University, Institute of Economic Studies at Faculty of Social Sciences & The Environment Center) |
| Abstract: | Consumers often struggle to grasp complicated pricing plans, including increasing block rate (IBR) schemes, which have been used for decades by utilities in many parts of the world. The assumption that they encourage conservation has, however, recently been challenged (Ito, 2014). We take advantage of the unique IBR tariffs for electricity in the Republic of Georgia - where "overage" is penalized more heavily than in conventional IBR - to ask whether consumers respond to price, and to which price specifically. Based on the data from several waves of the Georgia Household Budget Survey, we find evidence of "notches," namely missing probability mass on the right of the lowest block cutoff and a spike in the frequency of monthly consumption to the left of it. This is in contrast with the "bunching" pattern predicted by Borenstein (2009) when demand is not completely inelastic, and with the empirical evidence in Borenstein (2009) and Ito (2014). During our study period (2012-2019), the tariffs were revised - both downwards and upwards - to a different extent in different blocks and at different times across the regions of the country. We devise difference-in-difference study designs that exploit such natural experiments, finding that consumption did increase when the tariffs were reduced and fell when they were raised. Ours is one of the few studies that exploits quasi experimental conditions to examine whether the response to price changes is symmetric. We find that it is, in that the implied price elasticity of electricity demand is in both cases -0.3. Finally, we fit an electricity demand function, which results in an even stronger price elasticity (-0.5). Households seem to respond to the actual, average price (here equal to the marginal price) rather than to expected price. Our estimates of the price elasticity bode well for a carbon tax, an energy tax, or simple tariff increases to help curb imports of gas-fired electricity from neighboring countries. |
| Keywords: | residential electricity demand, price elasticity, increasing block rates, tariff schemes, asymmetric response to price changes |
| JEL: | D12 Q41 Q48 |
| Date: | 2021–10 |
| URL: | http://d.repec.org/n?u=RePEc:fau:wpaper:wp2021_34&r= |
| By: | Schmutzler, Armin; Letina, Igor; Seibel, Regina |
| JEL: | O31 L41 G34 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc21:242420&r= |
| By: | Maria Inês Castro; Maria Paula Fontoura |
| Abstract: | This study discusses the importance of hub airports’ air connectivity in improving the economic performance of the European Union countries during the period of 2008-2019. For this purpose, we use two different measurements of air connectivity - airport and hub connectivity, which are calculated using the Nestcan Model, and then, as a first step, we analyse the degree of linear association of each one of them with gross domestic product (GDP) and with a set of economic variables (hereafter designated as EVs) which, according to the literature, are expected to be positively determined by air connectivity and will boost a country´s economic performance, namely: inflows and outflows of foreign direct investment (FDI), imports, exports, and international tourism expenditures. We conclude that the type of air connectivity adopted matters. The results show that hub connectivity has a higher correlation with key variables for economic growth and is increasingly correlated with GDP during the period analysed, while a downward tendency over the more recent years was observed with regards airport connectivity. Next, we test the strength and direction of the quantitative relationship between hub connectivity and GDP/each EV for a sample of EU countries with a hub connectivity level of at least 5% of the TOP hub-connected EU country (Germany). Finally, we extract conclusions for individual countries, with the help of the scatter diagrams and regression lines. The results provide policy guidance regarding the role of hub connectivity in increasing the economic performance of a country, especially for those countries that are highly dependent on FDI, trade, and tourism for economic growth, as we illustrate for the case of Portugal. |
| Keywords: | air connectivity; airport connectivity; hub connectivity; foreign direct investment; international trade; tourism; Netscan Model; European Union; Portugal. |
| JEL: | E69 F20 L93 |
| Date: | 2021–10 |
| URL: | http://d.repec.org/n?u=RePEc:ise:remwps:wp02002021&r= |
| By: | Marten Ovaere; Stef Proost (-) |
| Abstract: | This paper surveys climate and energy policy in the EU transport sector covering the road, aviation, and shipping sectors. We summarise current policies, focusing on the Fit for 55 Package, and categorise them according to their targeted decision stage (consumption, investment, or research) and the type of instrument being used (e.g. cap-and-trade, tax, mandate, performance standard, or subsidy). Next, we analyse the cost-efficiency of the different policies and instruments. We find that they address a range of market inefficiencies, but that there are still a number of aspects that can further improve the cost-effectiveness of current EU climate policies in the transport sector. For example, higher taxes and an emission performance standards for aviation and shipping, the right combination of R&D investments and learning-by-doing policies, and balancing implicit carbon prices by revising the road tax system and adding congestion tolls and charges. Finally, European policy has important side effects on the rest of the world that need to be taken into account in the selection of policies. This improved set of policies can support a sustainable recovery and reach the European Union’s climate targets at the lowest cost. |
| Keywords: | European energy policy, European climate policy, European transport, policy, road transport, aviation, shipping, Fit for 55 Package |
| Date: | 2021–11 |
| URL: | http://d.repec.org/n?u=RePEc:rug:rugwps:21/1031&r= |
| By: | Hernando Hernández Lasso |
| Abstract: | El presente trabajo pretende analizar en términos económicos la subasta de privatización realizada en 2006 por la venta del 50 % + 1 de las acciones de Colombia Telecomunicaciones S.A. ESP y revisar la estructura de mercado actual en caso de una nueva posible privatización. Además, se muestran los aspectos intrínsecos que tiene Colombia en las telecomunicaciones a través de una descripción del sector en términos legales y económicos en aras de elaborar un modelo teórico de subasta donde el Estado pueda maximizar los beneficios esperados (maximización de rendimiento) y encontrar la probabilidad óptima que maximiza los rendimientos (optimalidad) para las dos privatizaciones mencionadas. Finalmente, en el trabajo se encuentra la necesidad de limitar a los ofertantes con ventajas de información en la subasta del 2006 y promover una mayor competitividad en la estructura de mercado del sector en la actualidad. *** This paper aims to analyze in economic terms the privatization auction carried out in 2006 for the sale of 50 % + 1 of the shares of Colombia Telecomunicaciones S.A. ESP and review the current market structure in case of new privatization. In addition, the intrinsic aspects that Colombia has in the sector are shown through a description in legal and economic terms to develop a theoretical auction model where the State can maximize the expected benefits (yield maximization) and find the optimal probability that maximizes returns (optimality). Finally, the paper shows the need to limit the bidders with information advantages in the 2006 auction and increase the competitiveness in the market structure of the sector today. |
| Keywords: | teoría de subastas, privatización, telecomunicaciones, eficiencia, maximización de rendimiento, optimalidad |
| JEL: | D44 D45 D82 |
| Date: | 2021–10–27 |
| URL: | http://d.repec.org/n?u=RePEc:col:000178:019716&r= |
| By: | Rieber, Alexander |
| JEL: | G01 G14 G24 G28 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc21:242434&r= |
| By: | Foly Ananou (LAPE - Laboratoire d'Analyse et de Prospective Economique - GIO - Gouvernance des Institutions et des Organisations - UNILIM - Université de Limoges); Dimitris Chronopoulos (University of St Andrews, Centre for Responsible Banking & Finance, Gateway Building, St Andrews, Fife KY16 9RJ, UK); Amine Tarazi (LAPE - Laboratoire d'Analyse et de Prospective Economique - GIO - Gouvernance des Institutions et des Organisations - UNILIM - Université de Limoges); John Wilson (University of St Andrews, Centre for Responsible Banking & Finance, Gateway Building, St Andrews, Fife KY16 9RJ, UK) |
| Abstract: | In this paper, we investigate the impact of liquidity requirements on bank risk. We take advantage of the implementation of the Liquidity Balance Rule (LBR) in the Netherlands in 2003 and analyze its impact on bank default risk. The LBR was imposed on Dutch banks only and did not apply to other banks operating elsewhere within the Eurozone. Using this differential regulatory treatment to overcome identification concerns, we find that following the introduction of the LBR, the risk of Dutch banks declined relatively to counterparts not affected by the rule. Concomitantly, despite the lower cost of funding driven by the LBR, the profitability of Dutch banks decreased in comparison with other banks in Europe, as a result of a decrease in income accruing from interest-bearing activities. Our findings also indicate that relatively to unaffected banks, Dutch banks might not have actively tried to offset their loss in interest income by increasing interest rates of loans. However, better financing conditions allowed Dutch banks to increase the shares of deposits and capital on the liability side of their balance sheets. |
| Keywords: | Banking,liquidity regulation,Netherlands,propensity score matching,quasi-natural experiment,risk,stability |
| Date: | 2021–10–05 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-03366418&r= |
| By: | Philip Beran; Arne Vogler (Chair for Management Sciences and Energy Economics, University of Duisburg-Essen) |
| Abstract: | Forecasting hourly electricity prices and their characteristic properties is a core challenge for energy generation companies and trading houses. The short-term marketing and purchase of electricity is usually managed with standardized products traded on different markets and with specific temporal resolution and maturity. The size and scope of the electricity price forecasting literature has grown significantly in recent years, with the majority of studies focused on short-term (intraday and day-ahead) or long-term (investment decisions) periods. However, the literature for forecasting the period beyond the day-ahead horizon, which is relevant for trading the aforementioned products or for managing assets over several days, is rather scarce. Our paper fills this gap by developing individual forecasting models covering horizons from the day ahead up to a week ahead. We introduce hybrids of a parsimonious fundamental model and various popular econometric models. In a case study for the German day-ahead market in 2016 we test and compare the different model settings by carefully considering realistic available data and limiting the calculation time to fit typical trading time constraints. We find that the best models across the individual horizons and across all horizons jointly are hybrid model approaches. They combine the strengths of autoregressive models in terms of capturing daily - even non-linear-structures with the immediate reactions of fundamental models to short-term events or fundamental changes in the market. |
| Keywords: | Electricity markets, Electricity Price Forecasting, Hybrid Modeling, Fundamental Modeling, Econometric Modeling, German Day-Ahead Market |
| JEL: | C13 C22 C51 Q41 Q47 |
| Date: | 2021–10 |
| URL: | http://d.repec.org/n?u=RePEc:dui:wpaper:2102&r= |
| By: | Alt, Marius |
| JEL: | Q58 D04 C91 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc21:242419&r= |
| By: | Philippe Gagnepain (PSE - Paris School of Economics - ENPC - École des Ponts ParisTech - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique - EHESS - École des hautes études en sciences sociales - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Stéphane Gauthier (PSE - Paris School of Economics - ENPC - École des Ponts ParisTech - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique - EHESS - École des hautes études en sciences sociales - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement) |
| Abstract: | This paper exploits the repeal of the Wright amendment as a natural experiment in order to contribute to the ongoing discussion on how the enlargement of the relevant market affects the ability of firms to coordinate on a Nash equilibrium. Using data on the U.S. air transportation industry, we present a Difference-inDifference procedure which sheds light on the significant loss of accuracy in airlines' predictions in markets originating in Dallas after the Love Field airport started operating long distance services in 2014. This suggests that competition authorities should be careful when they refer to the Nash equilibrium following market expansion reforms. |
| Keywords: | Airline industry,Nash equilibrium,Market definition,Transportation |
| Date: | 2021–09 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-03359597&r= |
| By: | Frederic Boissay; Torsten Ehlers; Leonardo Gambacorta; Hyun Song Shin |
| Abstract: | The business model of big techs rests on enabling direct interactions among a large number of users on digital platforms, such as in e-commerce, search and social media. An essential by-product is their large stock of user data, which they use to offer a wide range of services and exploit natural network effects, generating further user activity. Increased user activity completes the circle, as it generates yet more data. Building on the self-reinforcing nature of the data- network-activities loop, some big techs have ventured into financial services, including payments, money management, insurance and lending. The entry of big techs into finance promises efficiency gains and greater financial inclusion. At the same time, it introduces new risks associated with market power and data privacy. The nature of the new trade-off between efficiency and privacy will depend on societal preferences, and will vary across jurisdictions. This increases the need to coordinate policies both at the domestic and international level. |
| JEL: | E51 G23 O31 |
| Date: | 2021–10 |
| URL: | http://d.repec.org/n?u=RePEc:bis:biswps:970&r= |
| By: | Yuta Yasui (School of Economics and Management, Kochi University of Technology) |
| Abstract: | Assumptions of competitive structure are often crucial for marginal cost estimation and counterfactual predictions. This paper introduces tests for price competition among multi-product rms. The tests are based on the firm's revealed preference (revealed pro t function). In contrast to other approaches based on estimated demand functions such as conduct parameter estimation, the proposed tests do not require any instrumental variables, even though the models can accommodate structural error terms. In this paper, I employ a demand structure introduced by Nocke and Schutz (2018), the discrete/continuous choice model, which nests the multinomial logit demand and CES demand functions. Any price and quantity data can be rationalized by price competition under a discrete/continuous choice model and increasing marginal costs. Adding more assumptions to the demand function, such as logit, CES, or the co-evolving and log-concave property produces some falsifiable restrictions. |
| Keywords: | revealed preference, multi-product, conduct, discrete/continuous |
| Date: | 2021–10 |
| URL: | http://d.repec.org/n?u=RePEc:kch:wpaper:sdes-2021-14&r= |
| By: | Leroutier, Marion (Mistra Center for Sustainable Markets (Misum)) |
| Abstract: | Decreasing greenhouse gas emissions from electricity generation is crucial to tackle climate change. Empirically, however, little is known about the effectiveness of existing economic instruments in the power sector. This paper examines the impact of the UK Carbon Price Support (CPS), a carbon tax implemented in the UK power sector in 2013. Relative to a synthetic control unit built from other European countries, I find that emissions from the UK power sector declined by 20 to 26 percent per year on average between 2013 and 2017. The tax operated via three mechanisms: a decrease in emissions at the intensive margin; the closure of some high-emission plants at the extensive margin; and a higher probability of closure for plants already at risk due to European air quality regulations. |
| Keywords: | carbon tax; electricity generation; synthetic control method |
| JEL: | D22 H23 Q41 Q48 |
| Date: | 2021–10–26 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:hamisu:2021_003&r= |
| By: | Marta Castellini (Università degli Studi di Brescia, Fondazione Eni Enrico Mattei); Luca Di Corato (Ca’ Foscari University of Venice); Michele Moretto (Università degli Studi di Padova); Sergio Vergalli (Università degli Studi di Brescia, Fondazione Eni Enrico Mattei) |
| Abstract: | In this paper, we provide a real options model framing prosumers’ investment in photovoltaic plants. This is presented in a Smart Grid context where the exchange of energy among prosumers is possible. We determine the optimal size of the photovoltaic installations based on the influence the self-consumption profiles on the exchange of energy among prosumers. We calibrate the model using figures relative to the Northern Italy energy market and investigate the investment decision allowing for different prosumer profiles and consider several combinations of their individual energy demand and supply. Our findings show that the shape of individual energy demand and supply curves is crucial to the exchange of energy among prosumers, and that there could be circumstances under which no exchange occurs. |
| Keywords: | Smart Grids, Renewable Energy Sources, Real Options, Prosumer, Peer to Peer Energy Trading |
| JEL: | Q42 C61 D81 |
| Date: | 2021–10 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2021.25&r= |
| By: | Sebastian Rausch; Hidemichi Yonezawa (Statistics Norway) |
| Abstract: | Technology policy is the most widespread form of climate policy and is often preferred over seemingly efficient carbon pricing. We propose a new explanation for this observation: gains that predominantly accrue to households with large capital assets and that influence majority decisions in favor of technology policy. We study climate policy choices in an overlapping generations model with heterogeneous energy technologies and distortionary income taxation. Compared to carbon pricing, green technology policy leads to a pronounced capital subsidy effect that benefits most of the current generations but burdens future generations. Based on majority voting which disregards future generations, green technology policies are favored over a carbon tax. Smart "polluter-pays" financing of green technology policies enables obtaining the support of current generations while realizing efficiency gains for future generations. |
| Keywords: | Climate Policy; Green Technology Policy; Carbon Pricing; Overlapping Generations; Intergenerational Distribution; Social Welfare; General Equilibrium |
| JEL: | Q54 Q48 Q58 D58 H23 |
| Date: | 2021–10 |
| URL: | http://d.repec.org/n?u=RePEc:ssb:dispap:965&r= |
| By: | Takanori ADACHI; Michal FABINGER |
| Abstract: | This paper proposes a sufficient statistics approach to welfare analysis of third-degree price discrimination in differentiated oligopoly. Specifically, our sufficient conditions for price discrimination to increase or decrease aggregate output, social welfare, and con-sumer surplus simply entail a cross-market comparison of multiplications of two or three of the sufficient statistics—pass-through, conduct, and profit margin—that are functions of first-order and second-order elasticities of the firm’s demand. Notably, these results are derived under a general class of demand, and can be readily be extended to accom-modate heterogeneous firms. These features suggest that our approach has potential for conducting welfare analysis without a full specification of an oligopoly model. |
| Keywords: | Third-Degree Price Discrimination; Oligopoly; Sufficient Statistics. |
| JEL: | D43 L11 L13 |
| Date: | 2021–10 |
| URL: | http://d.repec.org/n?u=RePEc:kue:epaper:e-21-005&r= |
| By: | Martin F. Hellwig (Max Planck Institute for Research on Collective Goods) |
| Abstract: | The paper contributes to a symposium of the Oxford Review of Economic Policy on “Capitalism: What has Gone Wrong, What Needs to Change, and How can it be Fixed?”. The analysis starts from the observation that, in the United States, the United Kingdom and continental Europe, widespread discontent has become an important political force. I attribute this discontent to a sense on unfairness in developments of the past few decades. I relate this sense of unfairness to: (i) negative effects of structural change, including joblessness and regional decline, (ii) the observation of extraordinary growth in executive remuneration and financial-sector remuneration, coupled with government bailouts in the global financial crisis, and (iii) changes in public policy and public discourse, with a retrenchment of public services and public investment, except for bailouts and a focus on “efficiency”, the meaning of which is driven by the perceptions of corporate executives rather than standard welfare economics. To capture these developments, one needs to think about “capitalism” in the sense of French “capitalism” or German “Kapitalismus”, with a focus on the symbiosis of wealth and power, including the elimination of competition, rather than the English sense of merely another term for the market economy. |
| Keywords: | Efficient public-good provision, incomplete information, conditionally independent private values, macro uncertainty, budget balance, weakly robust incentive compatibility |
| Date: | 2021–08–11 |
| URL: | http://d.repec.org/n?u=RePEc:mpg:wpaper:2021_15&r= |
| By: | Eirik S. Amundsen (Department of Economics, University of Bergen; Department of Food and Resource Economics, University of Copenhagen) |
| Abstract: | This paper investigates whether a “Golden Rule” of regulation of an infectious disease may be elicited that balances the economic control and disease costs when the arrival of a future vaccine or a cure is uncertain. Formulating an optimal control problem applied to standard compartment models of infection, an optimality rule is derived. This rule is more complex than other similar Golden Rules related to optimal economic growth or extraction of natural resources. The paper contains interpretation of the derived rule and numeric examples of how the rule functions under the compartment models (i.e., the SI, the SIS, and the SIR models.) |
| Keywords: | Infectious disease, economic regulation, Golden Rule, compartment models |
| JEL: | C54 D62 I18 L51 |
| Date: | 2021–10 |
| URL: | http://d.repec.org/n?u=RePEc:foi:wpaper:2021_08&r= |
| By: | Céline Bonnet (TSE - Toulouse School of Economics - UT1 - Université Toulouse 1 Capitole - Université Fédérale Toulouse Midi-Pyrénées - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Zohra Bouamra-Mechemache (TSE - Toulouse School of Economics - UT1 - Université Toulouse 1 Capitole - Université Fédérale Toulouse Midi-Pyrénées - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Hugo Molina (ALISS - Alimentation et sciences sociales - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement) |
| Abstract: | We develop a framework of bilateral oligopoly with a sequential two-stage game in which manufacturers engage in bilateral bargains with retailers competing on a downstream market. We show that bargaining outcomes depend on three different bargaining forces and can be interpreted in terms of "equilibrium of fear". We estimate our framework using data on soft drink purchases in France and find that retailers have a higher bargaining power than manufacturers. Using counterfactual simulations, we highlight that retail mergers always increase retailers' fear of disagreement which weakens their bargaining power vis-à-vis manufacturers and leads to higher wholesale and retail prices. |
| Keywords: | Retail mergers,Bargaining,Bilateral oligopoly,Soft drink industry |
| Date: | 2021–10–13 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-03375907&r= |
| By: | Vanessa Alviarez (Sauder - Sauder School of Business [British Columbia] - UBC - University of British Columbia); Keith Head (Sauder - Sauder School of Business [British Columbia] - UBC - University of British Columbia); Thierry Mayer (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | We assess the consequences for consumers in 76 countries of multinational acquisitions in beer and spirits. Outcomes depend on how changes in ownership affect markups versus efficiency. We find that owner fixed effects contribute very little to the performance of brands. On average, foreign ownership tends to raise costs and lower appeal. Using the estimated model, we simulate the consequences of counterfactual national merger regulation. The US beer price index would have been 4–7% higher without divestitures. Up to 30% savings could have been obtained in Latin America by emulating the pro-competition policies of the US and EU. |
| Date: | 2020–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-03389199&r= |
| By: | Andres, Maximilian; Bruttel, Lisa; Friedrichsen, Jana |
| JEL: | C92 D43 L41 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc21:242372&r= |