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on Regulation |
| By: | David Martimort (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, EHESS - École des hautes études en sciences sociales); Jérôme Pouyet (THEMA - Théorie économique, modélisation et applications - CNRS - Centre National de la Recherche Scientifique - CY - CY Cergy Paris Université, ESSEC Business School - Essec Business School); Thomas Trégouët (THEMA - Théorie économique, modélisation et applications - CNRS - Centre National de la Recherche Scientifique - CY - CY Cergy Paris Université) |
| Abstract: | An incumbent seller contracts with a buyer and faces the threat of entry. The contract stipulates a price and a penalty for breach if the buyer later switches to the entrant. Sellers are heterogenous in terms of the gross surplus they provide to the buyer. The buyer is privately informed on her valuation for the incumbent's service. Asymmetric information makes the incumbent favor entry as it helps screening buyers. When the entrant has some bargaining power vis-à-vis the buyer and keeps a share of the gains from entry, the incumbent instead wants to reduce entry. The compounding effect of these two forces may lead to either excessive entry or foreclosure, and possibly to a fixed rebate for exclusivity given to all buyers. |
| Keywords: | excessive entry,foreclosure,exclusionary behavior,incomplete information |
| Date: | 2021–12 |
| URL: | http://d.repec.org/n?u=RePEc:hal:pseptp:hal-03328387&r= |
| By: | Gabriel Nasser Doile de Doyle (Renewable Energy Graduate Program, Federal University of Paraiba, Brazil & Electric Engineer PhD Program, Federal University of Itajuba, Brazil); Paulo Rotella Junior (Department of Production Engineering, Federal University of Paraiba, Brazil & Department of Management, Federal Institute of Education, Science and Technology - North of Minas Gerais, Brazil & Faculty of Finance and Accounting, Prague University of Economics and Business, Czech Republic & Faculty of Social Sciences, Charles University, Czech Republic); Luiz Celio Souza Rocha (Department of Management, Federal Institute of Education, Science and Technology - North of Minas Gerais, Brazil); Priscila Franca Gonzaga Carneiro (Renewable Energy Graduate Program, Federal University of Paraiba, Brazil); Rogério Santana Peruchi (Department of Production Engineering, Federal University of Paraiba, Brazil); Karel Janda (Faculty of Finance and Accounting, Prague University of Economics and Business, Czech Republic & Faculty of Social Sciences, Charles University, Czech Republic); Giancarlo Aquila (IEPG, Federal University of Itajuba, Brazil) |
| Abstract: | The Brazilian National Electrical Agency (ANEEL) proposed in 2019 that the costs for accessing the electricity grid should be shared among all consumers. This would do away with cross-subsidies where normal consumers without installed solar distributed generation (DG) units effectively cover the costs of access to the grid for consumers with DG units. We compared the viability of two scenarios, one before and the other after the proposed changes, to understand how this legislature will affect the viability of DG projects in Brazil. We did this by studying all 5 regions covering the whole Brazilian area by analyzing data on average solar radiation, demand, and energy prices. We conducted stochastic analysis by varying the investment costs, demand, and energy prices, for DG solar plants. Lastly, we conducted scholastic analysis for the national scenario by varying the Discount Rate (DR). We confirmed that there is a statically significant reduction in economic viability for DG solar units in Brazil if the proposed legislation were to be enacted, while the payback period and other financial indicators differ across regions. We confirmed that solar radiation is not the only decisive factor in determination of economic viability of DG solar production. |
| Keywords: | Distributed Generation, Regulation Policy, Cross-subsidies, Micro-Power Plants, Economic Feasibility Analysis, Solar Photovoltaic Energy |
| JEL: | Q41 Q48 |
| Date: | 2022–02 |
| URL: | http://d.repec.org/n?u=RePEc:fau:wpaper:wp2022_02&r= |
| By: | David Bounie (i3, CNRS, Télécom Paris, Institut Polytechnique de Paris); Antoine Dubus (Department of Management, Technology and Economics, ETH Zurich Leonhardstrasse 21 Switzerland – 8092 Zurich, Switzerland); Patrick Waelbroeck (i3, CNRS, Télécom Paris, Institut Polytechnique de Paris) |
| Abstract: | A monopolist data intermediary collects consumer information that it strategically sells to competing firms in a product market for price discrimination purposes. The intermediary charges a price of information and chooses the optimal partition that maximizes the willingness to pay of firms for information. Different selling mechanisms are compared: list prices, sequential bargaining, and auctions. The intermediary optimally sells information through auctions, whereas consumer surplus is maximized with sequential bargaining and list prices. We discuss the regulatory implications of our results. |
| Keywords: | Selling mechanisms; Market for information; Data intermediaries; Competition policy; Regulation of digital markets |
| Date: | 2022–02 |
| URL: | http://d.repec.org/n?u=RePEc:eth:wpswif:22-367&r= |
| By: | Kei Kawai; Jun Nakabayashi; Juan M. Ortner; Sylvain Chassang |
| Abstract: | Cartels participating in procurement auctions frequently use bid rotation or prioritize incumbents to allocate contracts. However, establishing a link between observed allocation patterns and firm conduct has been difficult: there are cost-based competitive explanations for such patterns. We show that by focusing on auctions in which the winning and losing bids are very close, it is possible to distinguish allocation patterns reflecting cost differences across firms from patterns reflecting non-competitive environments. We apply our tests to two datasets: the sample of Ohio milk auctions studied in Porter and Zona (1999), and a sample of municipal procurement auctions from Japan. |
| JEL: | L41 |
| Date: | 2022–01 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:29625&r= |
| By: | Nicolas Eschenbaum; Filip Melgren; Philipp Zahn |
| Abstract: | This paper develops a formal framework to assess policies of learning algorithms in economic games. We investigate whether reinforcement-learning agents with collusive pricing policies can successfully extrapolate collusive behavior from training to the market. We find that in testing environments collusion consistently breaks down. Instead, we observe static Nash play. We then show that restricting algorithms' strategy space can make algorithmic collusion robust, because it limits overfitting to rival strategies. Our findings suggest that policy-makers should focus on firm behavior aimed at coordinating algorithm design in order to make collusive policies robust. |
| Date: | 2022–01 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2201.00345&r= |
| By: | Paolo Bertoletti |
| Abstract: | We study platform competition by modelling the preferences of a “"representative buyer" ”over the services platforms provide and the commodities they intermediate. This captures an intensive margin of buyers’' participation which is neglected by the canonical setting, and delivers a welfare measure of platform quality. Assuming that sellers offer a large variety of commodities under monopolistic competition and free entry, in contrast to previous results we find that in a duopoly setting strategically chosen commissions (whose value depends on sellers’ expenditure share and demand elasticity) actually worsen buyers' ’welfare, which improves if platforms set commissions in advance of sellers' ’entry. |
| Keywords: | platform competition, market intermediation, exchange commissions |
| JEL: | D11 L13 L41 L51 |
| Date: | 2022–01 |
| URL: | http://d.repec.org/n?u=RePEc:mib:wpaper:486&r= |
| By: | Iwan Bos (Maastricht University); Marco A. Marini (Sapienza University of Rome); Riccardo D. Saulle (University of Padova) |
| Abstract: | This paper examines capacity-constrained oligopoly pricing with sellers who seek myopic improvements. We employ the Myopic Stable Set solution concept and establish the existence of a unique pure-strategy price solution for any given level of capacity. This solution is shown to coincide with the set of pure-strategy Nash equilibria when capacities are large or small. For an intermediate range of capacities, it predicts a price interval that includes the mixed-strategy support. This stability concept thus encompasses all Nash equilibria and oers a pure-strategy solution when there is none in Nash terms. It particularly provides a behavioral rationale for di erent pricing patterns, including Edgeworth price cycles and states of hypercompetition with supply shortages. We also analyze the impact of a change in firm size distribution. A merger among the biggest firms may lead to more price dispersion as it increases the maximum and decreases the minimum myopically stable price. |
| Keywords: | Bounded Rationality, Capacity Constraints, Mergers, Myopic Stable Set, Oligopoly Pricing, Supply Shortages |
| JEL: | C72 D43 L13 |
| Date: | 2021–12 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2021.32&r= |
| By: | 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); Vincent Chatellier (SMART-LERECO - Structures et Marché Agricoles, Ressources et Territoires - AGROCAMPUS OUEST - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Luc Delaby (PEGASE - Physiologie, Environnement et Génétique pour l'Animal et les Systèmes d'Elevage [Rennes] - AGROCAMPUS OUEST - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Cécile Detang-Dessendre (CODIR - Collège de Direction - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Jean-Louis Peyraud (CODIR - Collège de Direction - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Vincent Requillart (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) |
| Abstract: | Throughout the world, animal production faces huge sustainability challenges. The latter are exacerbated in the European Union (EU) by consumption issues linked, in particular, to the health and environmental impacts of meat consumption, and by the increasing societal concerns linked to animal welfare. Simultaneously, animal production may also provide benefits, notably from an economic and nutritional point of view. Some livestock systems, notably grass-based systems, may also offer positive climatic and environmental effects. Animal production is highly regulated in the EU, whereas the consumption of animal products is not (or very lightly) regulated. Many of the negative and positive effects are public goods that are not well taken into account by private actors and markets. Thus, there is legitimacy and scope for public policies aimed at reducing the damage and increasing the benefits of animal production and consumption. The last part of the paper explains how this could be achieved in the EU through a significantly revised and extended Common Agricultural Policy (CAP) that more closely follows the principles of public economics. Public regulation principles that are proposed have a more general scope and can be adapted to other livestock contexts. |
| Abstract: | Dans le monde entier, les productions animales sont confrontées à d'énormes défis en matière de durabilité. Ces derniers sont exacerbés dans l'Union européenne (UE) par les problèmes de consommation liés, notamment, aux impacts sanitaires et environnementaux de la consommation de viande, et par les préoccupations sociétales croissantes liées au bien-être animal. Simultanément, les productions animales peuvent également présenter des avantages, notamment d'un point de vue économique et nutritionnel. Certains systèmes d'élevage, notamment les systèmes basés sur l'herbe, peuvent également avoir des effets positifs sur le climat et l'environnement. Les productions animales sont fortement réglementées dans l'UE, alors que la consommation de produits animaux ne l'est pas (ou très peu). Bon nombre des effets négatifs et positifs sont des biens publics qui ne sont pas bien pris en compte par les acteurs privés et les marchés. Il existe donc une légitimité et une marge de manœuvre pour les politiques publiques visant à réduire les dommages et à augmenter les avantages de la production et de la consommation de produits animaux. La dernière partie de l'article explique comment cet objectif pourrait être atteint dans l'UE par le biais d'une politique agricole commune (PAC) considérablement révisée et étendue qui suit de plus près les principes de l'économie publique. Les principes de régulation publique qui sont proposés ont une portée plus générale et peuvent être adaptés à d'autres contextes d'élevage. |
| Keywords: | Animal production,Animal consumption,European Union,Public regulation,Public economics,Productions animales,Consommation de produits animaux,Union européenne,Réglementation publique,Economie publique |
| Date: | 2021–04–07 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-03215198&r= |
| By: | Catanzaro, Daniele (Université catholique de Louvain, LIDAM/CORE, Belgium); Pesenti, Raffaele; Ronco, Roberto |
| Abstract: | The combined increase of energy demand and environmental pollution at a global scale is forcing a rethinking of energy supply policies and production models in sustainable terms. In order to flatten demand peaks in power plants, energy suppliers adopted pricing policies that stimulate a change in the consumption practices of customers. One example of such policies is the Time-of-Use (TOU)-based tariffs, which encourage electricity usage at off-peak hours by means of low prices, while penalizing peak hours with higher prices. To avoid a sharp rise of the energy supply costs, manufacturing industry must carefully reschedule the production processes, by shifting them towards less expensive periods. TOU-based tariffs impose specific constraints on the completions of the jobs involved in the production processes as well as a partitioning of the time horizon of the production into a set of time slots, whose associated non-negative cost become part of the objective to be optimized. In this article, we review the flourishing literature on job scheduling in presence of TOU-based energy tariffs, with the view to provide researchers and practitioners with a framework that may guide them towards the most important theoretical results on the topic as well as the most prominent practical applications in sustainable manufacturing. |
| Keywords: | Combinatorial Optimization ; Energy Efficient Scheduling ; Time-of-Use Tariffs ; Sustainable Manufacturing |
| Date: | 2021–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:cor:louvco:2021019&r= |
| By: | Noam Michelson (Bank of Israel) |
| Abstract: | In this paper I fully map public administration connected firms in Israel in the years 2007â2015. Using various novel and comprehensive datasets, I identify every listed firm with at least one former civil servant, including politicians, in its management. I diverge from existing literature by also observing connectedness to working-level former civil servants and conducting a full analysis of the matching between a firm and a former civil servant, conditional on his or her civil service experience and the firmâs characteristics. The results show that 60 percent of Israeli publicly listed firms employ a former civil servant, and that 8 percent of all directors and executives are former civil servants. The matching analysis highlights several repeated transitions that are dependent on the civil servantsâ experience and the firmsâ activities. Specifically, I find that former regulators are prevalent in firms that used to be under their regulation, and that the level of a firmâs regulatory burden is positively associated with the presence of a former civil servant in its management. Using network analysis tools, I find that former civil servants are likely to be more centrally located and powerful in the business sphere, and that their unique capital decreases as the time since they left the public administration increases. The findings in this paper lay the infrastructure for further research and public debate concerning private-public sector transitions. |
| Date: | 2022–01 |
| URL: | http://d.repec.org/n?u=RePEc:boi:wpaper:2022.03&r= |
| By: | Ou Yang (Melbourne Institute: Applied Economic & Social Research, The University of Melbourne); Jongsay Yong (Melbourne Institute: Applied Economic & Social Research, The University of Melbourne); Yuting Zhang (Melbourne Institute: Applied Economic & Social Research, The University of Melbourne); Anthony Scott (Melbourne Institute: Applied Economic & Social Research, The University of Melbourne) |
| Abstract: | We quantify competition in Australia's residential aged care sector and study how competition is associated with quality of care and prices in the sector. Competition is defined three ways: the number of competitors within a 10 km radius of a facility; the distance (in km) to the third closest competing facility; and Herfindahl-Hirschman index based on market share of facilities within 10 km. We further examine whether quality and price differ by ownership types (government owned, for profit, and not for profit), after controlling for competition. We find that more competition is not associated with better quality or lower prices. Governmentowned facilities, in comparison to for-profit and not-for-profit facilities, are found to provide higher quality in some domains but not in others, yet tend to charge lower prices than other ownership types. The results indicate the possibility of market failures in aged care. Two key sources of market failures, the lack of public reporting of quality of care and price transparency, should be addressed as policy priorities before competition can work in residential aged care markets. |
| Keywords: | Nursing home competition, Aged care quality, Aged care prices, Australia |
| JEL: | I11 I18 L80 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:iae:iaewps:wp2021n02&r= |
| By: | Basant, Rakesh; Jaiswal, Neha |
| Abstract: | Based on the literature, the paper identifies processes that get initiated post an M&A event and affect the acquiring firm’s innovation efforts. We apply panel fixed effects estimation techniques to analyze the individual impact of mergers and acquisitions on R&D intensity of acquiring firms using data for 217 publically listed Indian pharmaceutical firms (both acquirers and non-acquirers) during 1999-2018. The study finds that acquisitions rather than mergers provide impetus to R&D in the acquiring firms. This suggests that these two combinations – mergers and acquisitions - do not unleash the same type of innovation activity related processes in the acquiring firm. Results also show that when mergers or acquisitions are combined with purchase of assets, they have a positive impact on R&D intensity. Purchase of assets when combined with M&A seem to provide access to relevant complementary assets that makes R&D activity profitable for the acquirer post the merger or acquisition event. Possibly, firms view purchase of assets as a strategy that is complementary to M&A strategies for enhancing innovation. The paper shows that impact of M&A on R&D takes time and it is useful to analyze the impact of mergers and acquisitions separately, rather than combining the two together. |
| Date: | 2022–01–25 |
| URL: | http://d.repec.org/n?u=RePEc:iim:iimawp:14670&r= |
| By: | ITF |
| Abstract: | This paper examines how 37 US cities regulate scooter parking. It analyses rates of improper scooter parking and discusses how cities can employ scooter regulations, in conjunction with other policies, to realise broader goals such as promoting sustainability and mobility. |
| Date: | 2021–03–17 |
| URL: | http://d.repec.org/n?u=RePEc:oec:itfaab:2021/11-en&r= |
| By: | Mohamed Belhaj (AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique - AMU - Aix Marseille Université); Frédéric Deroïan (AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique - AMU - Aix Marseille Université) |
| Abstract: | A monopoly sells a network good to a large population of consumers. We explore how the monopoly's profit and the consumer surplus vary with the arrival of public information about the network structure. The analysis reveals that, under homogeneous preferences for the good, degree assortativity ensures that information arrival increases both profit and consumer surplus. In contrast, heterogeneous preferences for the good can create a tension between consumer surplus and profit. |
| Keywords: | monopoly,network effects,network information,Bonacich centrality,degree assortativity,assortative mixing |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-03160602&r= |
| By: | Habis, Helga; Perge, Laura |
| Abstract: | In this paper, we show that the capital asset pricing model can be derived from a three-period general equilibrium model. We show that our extended model yields a Pareto efficient outcome. This result indicates that the beta pricing formula could be applied in a long term model settings as well. |
| Keywords: | general equilibrium, CAPM, intertemporal choice, Pareto efficiency |
| JEL: | D15 D53 G12 |
| Date: | 2022–01–18 |
| URL: | http://d.repec.org/n?u=RePEc:cvh:coecwp:2022/01&r= |