Economics Commons^™

Endogenous R&D And Intellectual Property Laws In Developed And Emerging Economies, Aniruddha Bagchi, Abhra Roy

Abhra Roy

The incentive of providing protection of intellectual property has been analyzed, both for an emerging economy as well as for a developed economy. The optimal patent length and the optimal patent breadth within a country are found to be positively related to each other for a fixed structure of laws abroad. Moreover, a country can respond to stronger patent protection abroad by weakening its patent protection under certain circumstances and by strengthening its patent protection under other circumstances. These results depend upon the curvature of the R&D production function. Finally, we investigate the impact of an increase in the willingness-to-pay …

“The Role Of Switching Costs In The Markets For Pc Operating Systems, Online Search, Internet Access And Mobile Service: Implications For Australian Competition And Consumer Protection Policy”, Robert G. Harris

Robert G Harris

This paper addresses the role of switching costs in computing, communications and information technologies. Switching costs (and closely related network effects) play an increasingly important role in competitive analysis and competition policy. This paper considers the interplay of switching costs and the emergence of the digital, online economy, and examines the implications of switching costs for competition and competition policies in Australia.

Optimal Environmental Taxation With Pre-Commitment And Green R&D, Stuart Mcdonald

Stuart McDonald

Two approaches for modelling investment in R\&D have been developed by d'Aspremont and Jacquemin (AJ, 1988) and Kamien, Muller and Zang (KMZ, 1992), when there are spillovers associated with R\&D effort. This paper examines how these two approaches predict investment in green technology, when environmental policy takes the form of an optimal emission tax. The results show that the two models are equivalent when there are no R\&D spillovers; but when R\&D spillovers are present, significant differences in their predictions are observed. Specifically, the KMZ model predicts higher emission tax rates, higher level of R\&D expenditures and higher levels of …

Antitrust And The 'Filed Rate' Doctrine: Deregulation And State Action, Herbert J. Hovenkamp

All Faculty Scholarship

In its Keogh decision the Supreme Court held that although the Interstate Commerce Act did not exempt railroads from antitrust liability, a private plaintiff may not recover treble damages based on an allegedly monopolistic tariff rate filed with a federal agency. Keogh very likely grew out of Justice Brandeis's own zeal for regulation and his concern for the protection of small business — in this case, mainly shippers whom he felt were protected from discrimination by filed rates. The Supreme Court's Square D decision later conceded that Keogh may have been “unwise as a matter of policy,” but reaffirmed it …

Pricing Lower Or Buying Cheaper? How Grocery Consumers Pay Less During Seasonal Demand Peaks, Colin Watson

Undergraduate Economic Review

The average price paid for a seasonal grocery category is (surprisingly) lower during the category's seasonal demand peak. For several product categories at one supermarket chain, demand peaks are shown to be associated with 1) consumer substitution to lower-quality products, 2) product price reductions, especially on products that increase their market shares, and as a result 3) a decline in the average price paid for the product category. In one very seasonal category, price reductions are driven by intertemporal substitution associated with large weekly discounts. Findings are consistent with any of several loss leader models.

Antitrust And Nonexcluding Ties, Herbert J. Hovenkamp

All Faculty Scholarship

Notwithstanding hundreds of court decisions, tying arrangements remain enigmatic. Conclusions that go to either extreme, per se legality or per se illegality, invariably make simplifying assumptions that frequently do not obtain. For example, by ignoring double marginalization or tying product price cuts it becomes very easy to prove that a wide range of ties are anticompetitive. At the other extreme, by ignoring foreclosure possibilities one can readily conclude that ties are invariably benign.

Ties have historically been thought to produce two kinds of competitive harm: “leverage,” or extraction; and foreclosure, or exclusion. The two theories are not mutually exclusive. Indeed, …

Comparative Antitrust Federalism: Review Of Cengiz, Antitrust Federalism In The Eu And The Us, Herbert J. Hovenkamp

All Faculty Scholarship

This brief essay reviews Firat Cengiz’s book Antitrust Federalism in the EU and the US (2012), which compares the role of federalism in the competition law of the European Union and the United States. Both of these systems are “federal,” of course, because both have individual nation-states (Europe) or states (US) with their own individual competition provisions, but also an overarching competition law that applies to the entire group. This requires a certain amount of cooperation with respect to both territorial reach and substantive coverage.

Cengiz distinguishes among “markets,” “hierarchies,” and “networks” as forms of federalism. Markets are the least …

The Striking Success Of The National Labor Relations Act, Michael L. Wachter

All Faculty Scholarship

Although often viewed as a dismal failure, the National Labor Relations Act (NLRA) has been remarkably successful. While the decline in private sector unionization since the 1950s is typically viewed as a symbol of this failure, the NLRA has achieved its most important goal: industrial peace.

Before the NLRA and the 1947 Taft-Hartley Amendments, our industrial relations system gave rise to frequent and violent strikes that threatened the nation’s stability. For example, in the late 1870s, the Great Railroad Strike spread throughout a number of major cities. In Pittsburg alone, strikes claimed 24 lives, nearly 80 buildings, and over 2,000 …

Price Elasticity Of Expenditure Across Health Care Services, Fabian Duarte

Fabian Duarte

Policymakers in countries around the world are faced with rising health care costs and are debating ways to reform health care to reduce expenditures. Estimates of price elasticity of expenditure are a key component for predicting expenditures under alternative policies. Using unique individual-level data compiled from administrative records from the Chilean private health insurance market, I estimate the price elasticity of expenditures across a variety of health care services. I find elasticities that range between zero for the most acute service (appendectomy) and −2.08 for the most elective (psychologist visit). Moreover, the results show that at least one third of …

Competition And Innovation In Copyright And The Dmca, Herbert J. Hovenkamp

All Faculty Scholarship

This book of CASES AND MATERIALS ON INNOVATION AND COMPETITION POLICY is intended for educational use. The book is free for all to use subject to an open source license agreement. It differs from IP/antitrust casebooks in that it considers numerous sources of competition policy in addition to antitrust, including those that emanate from the intellectual property laws themselves, and also related issues such as the relationship between market structure and innovation, the competitive consequences of regulatory rules governing technology competition such as net neutrality and interconnection, misuse, the first sale doctrine, and the Digital Millennium Copyright Act (DMCA). Chapters …

Trade, Firm Selection, And Industrial Agglomeration, Wen-Tai Hsu, Ping Wang

Research Collection School Of Economics

We develop a model of trade and agglomeration that incorporates trade in both intermediate goods and final goods and allows all firms to choose their locations. There are two types of labor: skilled labor, which is mobile, and unskilled labor, which is immobile. Upon choosing its factory site, a final goods firm that is managed by skilled labor can produce these goods using local unskilled labor and a variety of intermediate goods produced by productivity-heterogeneous producers. We characterize world equilibrium and establish the conditions under which industrial agglomeration arises as a stable equilibrium outcome. We show that when the unskilled …

Antitrust And The Costs Of Movement, Herbert J. Hovenkamp

All Faculty Scholarship

Antitrust is rightfully concerned about the structure of markets as well as the bargaining that occurs in them. As a result, the absolute cost of redeploying resources can be just as important as the transaction costs of arranging for their movement. This paper examines several broad themes in antitrust, considering the role of various assumptions about the costs of getting resources moved toward superior positions and the ability of the antitrust system to facilitate this movement. Part II very briefly examines structuralism as a theory underlying antitrust enforcement, particularly its assumptions about the difficulty and costs of moving resources. Harvard …

A Relational Contract For Water Demand Management, R K Amit, Parthasarathy Ramachandran

R K Amit

For necessary goods like water, under supply constraints, fairness considerations lead to negative externalities. The objective of this paper is to design an infinite horizon contract or relational contract (a type of long-term contract) that ensures self-enforcing (instead of court-enforced) behaviour by the agents to mitigate the externality due to fairness issues. In this contract, the consumer is induced to consume at firm-supply level using the threat of higher fair price for future time periods. The pricing mechanism, computed in this paper, internalizes the externality and is shown to be economically efficient and provides revenue sufficiency.

Competition In Information Technologies: Standards-Essential Patents, Non-Practicing Entities And Frand Bidding, Herbert J. Hovenkamp

All Faculty Scholarship

Standard Setting is omnipresent in networked information technologies. Virtually every cellular phone, computer, digital camera or similar device contains technologies governed by a collaboratively developed standard. If these technologies are to perform competitively, the processes by which standards are developed and implemented must be competitive. In this case attaining competitive results requires a mixture of antitrust and non-antitrust legal tools.

FRAND refers to a firm’s ex ante commitment to make its technology available at a “fair, reasonable and nondiscriminatory royalty.” The FRAND commitment results from bidding to have one’s own technology selected as a standard. Typically the FRAND commitment is …

The Disciplining Effect Of Concern For Referrals: Evidence From Real Estate Agents, Lan Shi, Christina Tapia

Lan Shi

No abstract provided.

Competition Policy For Industry Standards, Richard J. Gilbert

Richard J Gilbert

This paper is a chapter in the forthcoming Oxford Handbook on International Antitrust Economics. The chapter surveys issues raised by the development of industry standards, whether accomplished through a formal standard setting committee structure or the activities of a single sponsor. The focus is on the tradeoff between the benefits from standards and possible costs that standards and the activity of standard development may impose on consumers. A particular focus is on the consequences of intellectual property rights for standards.

The Pros And Cons Of Outsourcing, Angela Smith

UNLV Theses, Dissertations, Professional Papers, and Capstones

Outsourcing has become increasingly popular to the public since the mid-20th century and has become more controversial in the last decade. The United States economy has been under the microscope for the last 4 years due to an economic recession. Outsourcing has been a subject of interest that has been brought up numerous times by economists. Offshore outsourcing is the main type of outsourcing that is of concern in relation to the United States economy. This topic is highly debated because of the unemployment rate in America.

Competition Policy For Industry Standards, Richard J. Gilbert

Richard Gilbert

This paper is a chapter in the forthcoming Oxford Handbook on International Antitrust Economics. The chapter surveys issues raised by the development of industry standards, whether accomplished through a formal standard setting committee structure or the activities of a single sponsor. The focus is on the tradeoff between the benefits from standards and possible costs that standards and the activity of standard development may impose on consumers. A particular focus is on the consequences of intellectual property rights for standards.

Import Decisions And Firm Performance - An Empirical Analysis For The Netherlands, Henk Lm Kox

Henk LM Kox

This paper investigates the relation between import decisions and productivity performance for Dutch firms. Importer productivity premiums appear to be larger than those for exporting firms. In the perspective of recent trade theory this indicates that trade costs for importers are at least as important as they are for exporting firms. For import starters I find evidence that ex ante productivity-based self selection is important. This also points in the direction of considerable sunk trade costs for firms that engage in direct imports.

Unleashing Competition In Eu Business Services, Henk Lm Kox

Henk LM Kox

Essays On Industrial Organization And Environmental Economics, Cristina Marie Reiser

Doctoral Dissertations

This dissertation consists of three chapters that examine how regulation by a central authority motivates changes in behavior.

Chapter 1 identifies the role of a tolerance policy as a manager’s regulatory mechanism which can deter worker misconduct in rank-order tournaments. When contestants’ actions cannot be perfectly monitored or doing so is prohibitively costly, misconduct takes place. This chapter develops a theoretical model in which contestants compete for a prize in a symmetric tournament and in which the organizer tolerates some level of misconduct. In addition to showing that zero tolerance does not minimize equilibrium misconduct, it also shows there exists …

Dynamic Market Selection In Eu Business Services, Henk Lm Kox, George Van Leeuwen

Henk LM Kox

Price Effects And Switching Costs Of Airlines Frequent Flyer Program, Claudio A. Agostini, Manuel Willington

Claudio A. Agostini

Frequent flier programs create a switching cost for the consumer and allow firms to exercise market power. In Chile there is a dominant airline in domestic markets that has a frequent flyer program with a large number of affiliates and it faces some competition from two small carriers that do have a frequent flyer program. Using a unique dataset for Chile we estimate the switching cost of each airline and the impact of the dominant airline frequent flyer program on prices. The results show a fare premium of around 18% due to the frequent flyer program.

Sweetening The Deal? Political Connections And Sugar Mills In India, Sandip Sukhtankar

Dartmouth Scholarship

Political control of firms is prevalent across the world. Evidence suggests that firms profit from political connections, and politicians derive benefit from control over firms. This paper investigates an alternative mechanism through which politicians may benefit electorally from connected firms, examining sugar mills in India. I find evidence of embezzlement in politically controlled mills during election years, reflected in lower prices paid to farmers for cane. This result complements the literature on political cycles by demonstrating how campaign funds are raised rather than used. Politicians may recompense farmers upon getting elected, possibly explaining how they can get away with pilferage. …

The Debate Over The State Of U.S. Manufacturing: How The Computer Industry Affects The Numbers And Perceptions, Susan N. Houseman

Employment Research Newsletter

No abstract provided.

Workplace Deviance And Recession, Aniruddha Bagchi

Faculty and Research Publications

No abstract provided.

Workplace Deviance And Recession, Aniruddha Bagchi

Aniruddha Bagchi

No abstract provided.

Industrial Policy And Renewable Energy: Trade Conflicts, Robert J. Carbaugh, Max St. Brown

All Faculty Scholarship for the College of Business

Governments use industrial policy to promote the development of new industries and the creation and adoption of new technologies. Such policy involves subsidies granted to producers and consumers, usually for the purpose of correcting a market failure. Concerning renewable energies such as wind energy and solar energy, China, the United States, and the European Union provide extensive support to producers and consumers. This support has resulted in trade frictions among these nations. This paper discusses the relationship between industrial policy and trade disputes in renewable energy.

Human Capital Formation And Economic Development In Pakistan: An Empirical Analysis, Muhammad Irfan Chani, Mahboob Ul Hassan, Muhammad Shahid

Muhammad Irfan Chani

This study investigates the casual relationship between economic development and formation of human capital in Pakistan. Based on endogenous growth theory, this study empirically tests the standard growth model consisting of gross domestic product (GDP) per capita as a dependent variable and human capital formation, investment in physical capital and labor force as independent variables. Autoregressive distributive lag (ARDL) bound testing approach to cointegration is used to check the long-run equilibrium relationship between the variables included in the model. For checking the causal relationship between economic development and human capital formation, pair-wise Granger causality test is used for time series …

Una Propuesta De Crédito Tributario Al Ingreso Para Chile, Claudio A. Agostini, Marcela Perticará, Javiera Selman

Claudio A. Agostini

En 1975, Estados Unidos estableció un sistema de crédito tributario reembolsable focalizado en familias de bajos o moderados ingresos denominado Earned Income Tax Credit (EITC). La recepción del crédito es condicional en trabajar, y si este es mayor a lo que una familia debe pagar por impuestos, entonces se le hace una transferencia monetaria. Esta política ha tenido un impacto positivo en la participación laboral femenina, sobre todo de mujeres madres solteras, y se ha constituido en el programa más importante de ese país en la reducción de la pobreza. Este documento simula el efecto que tendría implementar un esquema …