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Antitrust And The Design Of Production, Herbert J. Hovenkamp 2017 University of Pennsylvania Law School

Antitrust And The Design Of Production, Herbert J. Hovenkamp

Faculty Scholarship

Both economics and antitrust policy have traditionally distinguished “production” from “distribution.” The former is concerned with how products are designed and built, the latter with how they are placed into the hands of consumers. Nothing in the language of the antitrust laws suggests much concern with production as such. Although courts do not view it that way, even per se unlawful naked price fixing among rivals is a restraint on distribution rather than production. Naked price fixing assumes a product that has already been designed and built, and the important cartel decision is what should be each firm’s output ...


Intellectual Property And Competition, Herbert J. Hovenkamp 2017 University of Pennsylvania Law School

Intellectual Property And Competition, Herbert J. Hovenkamp

Faculty Scholarship

A legal system that relies on private property rights to promote economic development must consider that profits can come from two different sources. First, both competition under constant technology and innovation promote economic growth by granting many of the returns to the successful developer. Competition and innovation both increase output, whether measured by quantity or quality. Second, however, profits can come from practices that reduce output, in some cases by reducing quantity, or in others by reducing innovation.

IP rights and competition policy were traditionally regarded as in conflict. IP rights create monopoly, which was thought to be inimical to ...


Measuring Market Power In Professional Baseball, Basketball, Football And Hockey, Gerald T. Healy III, Jing Ru Tan, Peter Orazem 2017 Iowa State University

Measuring Market Power In Professional Baseball, Basketball, Football And Hockey, Gerald T. Healy Iii, Jing Ru Tan, Peter Orazem

Economics Working Papers

Forbes Magazine estimates of annual revenues, costs and team values for professional sports teams are used to derive market power measures for teams in four major professional sports leagues: the MLB, NBA, NHL, and the NFL. Two variants of the Lerner Index, one that reflects short-term operations for the past year and another reflecting the long-run net present value of the franchise are derived over the 2006-2016 period. Only the long-run measure provides estimates that are always consistent with theoretical requirements. Analysis of variance of long-run market power shows that local market factors and past team performance have less impact ...


Braided Cobwebs: Cautionary Tales For Dynamic Retail Pricing In End-To-End Power Systems, Auswin George Thomas, Leigh Tesfatsion 2017 Siemans Industry, Mpls

Braided Cobwebs: Cautionary Tales For Dynamic Retail Pricing In End-To-End Power Systems, Auswin George Thomas, Leigh Tesfatsion

Leigh Tesfatsion

This study investigates the effects of dynamic-price retail contracting on end-to-end power system operations. Performance is evaluated by means of carefully defined metrics for system stability, market efficiency, and market participant welfare. The study is carried out for an Integrated Retail and Wholesale (IRW) Test Case for which households have smart (price-responsive) air-conditioning (A/C) systems. A simplified version of the IRW Test Case with a directly postulated linear household demand curve is first used to derive, analytically, a set of necessary and sufficient conditions for system stability under dynamic-price retail contracting. A key finding is that dynamicprice retail contracts ...


Braided Cobwebs: Cautionary Tales For Dynamic Retail Pricing In End-To-End Power Systems, Auswin George Thomas, Leigh Tesfatsion 2017 Siemans Industry, Mpls

Braided Cobwebs: Cautionary Tales For Dynamic Retail Pricing In End-To-End Power Systems, Auswin George Thomas, Leigh Tesfatsion

Economics Working Papers

This study investigates the effects of dynamic-price retail contracting on end-to-end power system operations. Performance is evaluated by means of carefully defined metrics for system stability, market efficiency, and market participant welfare. The study is carried out for an Integrated Retail and Wholesale (IRW) Test Case for which households have smart (price-responsive) air-conditioning (A/C) systems. A simplified version of the IRW Test Case with a directly postulated linear household demand curve is first used to derive, analytically, a set of necessary and sufficient conditions for system stability under dynamic-price retail contracting. A key finding is that dynamicprice retail contracts ...


Willingness-To-Pay Vs. Willingness-To-Accept: Legal And Economic Implications,, Elizabeth Hoffman, Matthew L. Spitzer 2017 Iowa State University

Willingness-To-Pay Vs. Willingness-To-Accept: Legal And Economic Implications,, Elizabeth Hoffman, Matthew L. Spitzer

Elizabeth Hoffman

Do people value commodities more when they own the commodities than when they do not? Although economic models generally presume that economic agents evaluate commodities independently of whether the agents own those commodities--the "basic independence" assumption researchers in economics and law are starting to doubt whether this assumption is true. Doubts about the soundness of the basic independence assumption challenge accepted economic doctrines. Most theoretical and applied models in economics use the basic independence assumption both to predict and to assess the operation of markets. In the relatively new discipline that combines law and economics, the basic independence assumption produces ...


The Impact Of Transportation Costs On Spatial Competition Of Grain Buyers: An Iowa Case Study, Miguel Carriquiry, Bruce A. Babcock 2017 Iowa State University

The Impact Of Transportation Costs On Spatial Competition Of Grain Buyers: An Iowa Case Study, Miguel Carriquiry, Bruce A. Babcock

Bruce Babcock

Hotelling’s classic model of spatial competition is adapted to estimate the impacts on grain price of the closure of one of three grain buyers on the Mississippi River in the vicinity of Scott County, Iowa. The customers of the buyer who is closing (River Gulf Grain Company) in Davenport, Iowa, are assumed to deliver their grain to a buyer in either Buffalo, Iowa, to the south or to a buyer in Clinton, Iowa, to the north. Calibration of Hotelling’s framework to this situation leads to an estimated decline in grain bids of 1.5¢ per bushel for the ...


Trust In Cohesive Communities, Felipe Balmaceda Assoc Prof., Juan Escobar Assistant Professor 2017 Diego Portales University

Trust In Cohesive Communities, Felipe Balmaceda Assoc Prof., Juan Escobar Assistant Professor

Felipe Balmaceda

This paper studies which social networks maximize trust and welfare when agreements are implicitly enforced. We study a repeated trust game in which trading opportunities arise exogenously and a social network determines the information each player has. We show that cohesive communities, modeled as social networks of complete components, emerge as the optimal community design. Cohesive communities generate some degree of common knowledge of transpired play that allows players to coordinate their punishments and, as a result, yield relatively high equilibrium payoffs. We also show that when news swiftly travel through the network, Pareto efficient networks are minimally connected: the ...


The Use And Reliability Of Federal Nature Of Suit Codes, Christina L. Boyd, David A. Hoffman 2017 University of Georgia

The Use And Reliability Of Federal Nature Of Suit Codes, Christina L. Boyd, David A. Hoffman

Faculty Scholarship

When filing a civil case in a federal district court, attorneys must identify one, and only one, of ninety issue area nature of suit (NOS) codes that best describes their case. While this may seem like a trivial moment in litigation, the selection of this single descriptor has significant implications for court statistics, empirical research findings, and the allocation of resources to federal courts, including judgeships. Despite the import of NOS codes, there is little within the process of choosing them to guarantee reliability in the selected NOS codes. To assess how reliable NOS codes are, we examine a database ...


Entrepreneurial Skills In Thick And Thin Markets, Georgeanne M. Artz, Zizhen Guo, Peter F. Orazem 2017 Iowa State University

Entrepreneurial Skills In Thick And Thin Markets, Georgeanne M. Artz, Zizhen Guo, Peter F. Orazem

Economics Working Papers

Firm profitability is affected by location-specific factors such as agglomeration economies, infrastructure, or proximity to consumers or key producers. Location-specific profits are also influenced by the idiosyncratic match between the entrepreneur and the community. Using data on the universe of all new firm entrants in North Carolina and Iowa between 1992–2011, this study shows how observed location-specific factors affect the probability of new firm entry. We then show that the unobserved factors that influence new firm entry increase the probability of firm survival, demonstrating that these unobserved idiosyncratic factors influence firm profitability and are not just unproductive entrepreneurial preferences ...


A Swing-Contract Market Design For Flexible Service Provision In Electric Power Systems, Wanning Li, Leigh Tesfatsion 2017 Iowa State University

A Swing-Contract Market Design For Flexible Service Provision In Electric Power Systems, Wanning Li, Leigh Tesfatsion

Economics Working Papers

The need for flexible service provision in electric power systems has dramatically increased due to the growing penetration of variable energy resources, as has the need to ensure fair access and compensation for this provision. A swing contract (SC) facilitates flexible service provision because it permits multiple service attributes to be offered together in bundled form with each attribute expressed as a range of possible values rather than as a single point value. This paper discusses a new SC Market Design for electric power systems that permits SCs to be offered by any dispatchable resource. An analytical optimization formulation is ...


The Rule Of Reason, Herbert J. Hovenkamp 2017 University of Pennsylvania Law School

The Rule Of Reason, Herbert J. Hovenkamp

Faculty Scholarship

Antitrust’s rule of reason was born out of a thirty year (1897-1927) division among Supreme Court Justices about the proper way to assess multi-firm restraints on competition. By the late 1920s the basic contours of the rule for restraints among competitors was roughly established. Antitrust policy toward vertical restraints remained much more unstable, however, largely because their effects were so poorly understood.

This article provides a litigation field guide for antitrust claims under the rule of reason – or more precisely, for situations when application of the rule of reason is likely. At the time pleadings are drafted and even ...


Targeted Advertising, Platform Competition And Privacy, Henk L.M. Kox, Bas Straathof, Gijsbert Zwart 2017 KVL Economic Policy Research

Targeted Advertising, Platform Competition And Privacy, Henk L.M. Kox, Bas Straathof, Gijsbert Zwart

Henk LM Kox

Targeted advertising can benefit consumers through lower prices for access to websites. Yet, if consumers dislike that websites collect their personal information, their welfare may go down. We study competition for consumers between websites that can show targeted advertisements. We find that more targeting increases competition and reduces the websites’ profits, but yet in equilibrium websites choose maximum targeting as they cannot credibly commit to low targeting. A privacy protection policy can be beneficial for both consumers and websites. If consumers are heterogeneous in their concerns for privacy, a policy that allows choice between two levels of privacy will be ...


A Study Of The Factors That Influence Consumer Attitudes Toward Beef Products Using The Conjoint Market Analysis Tool, Brian E. Mennecke, Anthony M. Townsend, Dermot J. Hayes, Steven M. Lonergan 2017 Iowa State University

A Study Of The Factors That Influence Consumer Attitudes Toward Beef Products Using The Conjoint Market Analysis Tool, Brian E. Mennecke, Anthony M. Townsend, Dermot J. Hayes, Steven M. Lonergan

Steven M. Lonergan

This study utilizes an analysis technique commonly used in marketing, the conjoint method, to examine the relative utilities of a set of beef steak characteristics considered by a national sample of 1,432 U.S. consumers, as well as additional localized samples representing undergraduate students at a business college and in an animal science department. The analyses indicate that among all respondents, region of origin is by far the most important characteristic; this is followed by animal breed, traceability, the animal feed used, and beef quality. Alternatively, the cost of cut, farm ownership, the non-use of growth promoters, and whether ...


Producing Energy While Sequestering Carbon? The Relationship Between Biochar And Agricultural Productivity, Nathan Kauffman, Jerome Dumortier, Dermot J. Hayes, Robert C. Brown, David Laird 2017 Federal Reserve Bank of Kansas CIty

Producing Energy While Sequestering Carbon? The Relationship Between Biochar And Agricultural Productivity, Nathan Kauffman, Jerome Dumortier, Dermot J. Hayes, Robert C. Brown, David Laird

Robert C. Brown

A partial solution to problems associated with anthropogenic greenhouse gas (GHG) emissions could be the development and deployment of carbon-negative technologies, i.e., producing energy while reducing atmospheric carbon dioxide levels. Biofuels have been considered a possibility but have faced limitations due to competition with food production and GHG emissions through indirect land-use change (ILUC). In this article, we show how emissions from ILUC can potentially be reduced by producing food and bioenergy from biochar amended soils. The possibility of yield improvements from biochar would reduce the land requirement for crop production and thus, lead to a reduction in emissions ...


Show Me The Money: Federal R&D Support For Academic Chemistry, 1990–2009, Joshua L. Rosenbloom, Donna K. Ginther 2017 Iowa State University and NBER

Show Me The Money: Federal R&D Support For Academic Chemistry, 1990–2009, Joshua L. Rosenbloom, Donna K. Ginther

Joshua L. Rosenbloom

We examine the distribution of Federal support for chemistry Research and Development (R&D) performed at U.S. universities from 1990-2009. Federal R&D funding is an essential source of funds for investigator-driven research at the nation’s universities. Previous studies have documented that aggregated federal R&D funding has become more dispersed over time and attributed this to political pressure to spread resources more evenly. There have, however, been few studies of the allocation of funds within narrowly defined scientific disciplines. By narrowing the focus and exploiting the panel nature of our data we are better able to analyze ...


Crop Residues: The Rest Of The Story, Douglas L. Karlen, Rattan Lal, Ronald F. Follett, John M. Kimble, Jerry L. Hatfield, John A. Miranowski, Cynthia A. Cambardella, Andrew Manale, Robert P. Anex, Charles W. Rice 2017 United States Department of Agriculture

Crop Residues: The Rest Of The Story, Douglas L. Karlen, Rattan Lal, Ronald F. Follett, John M. Kimble, Jerry L. Hatfield, John A. Miranowski, Cynthia A. Cambardella, Andrew Manale, Robert P. Anex, Charles W. Rice

Douglas L Karlen

Synopsis In the February 15, 2009 issue of ES&T Strand and Benford argued that oceanic deposition of agricultural crop residues was a viable option for net carbon sequestration (43 [4], 1000−1007). In reviewing the calculations and bringing their experience to bear, Karlen et al. argue in this Viewpoint that crop residue oceanic permanent sequestration (CROPS) as envisioned by Strand and Benford will not work. They further propose alternative possibilities in agricultural methods to achieve a net decrease of CO2 emissions.


Economic Impacts Of Wind Energy Development In Iowa: Four Scenarios, David Swenson 2017 Iowa State University

Economic Impacts Of Wind Energy Development In Iowa: Four Scenarios, David Swenson

David Swenson

The deployment of additional wind energy capacity in Iowa will yield discernible short-term and longer-term economic impacts for Iowa. The short-term and temporary economic gains are from the annual purchases and deliveries of Iowa-supplied wind energy generating equipment like blades, towers, nacelles and other critical components, and all construction-related activity associated with erecting and making operational wind energy arrays The long-term and permanent gains to the Iowa economy are driven by the on-going increments to statewide productivity associated with the operation and maintenance of the built wind energy systems, and the incremental increase in lease payments made to landowners for ...


Economic Profile Of Fabricated Metals Manufacturing In Iowa, Liesl Eathington, David Swenson 2017 Iowa State University

Economic Profile Of Fabricated Metals Manufacturing In Iowa, Liesl Eathington, David Swenson

David Swenson

The fabricated metals industry in Iowa is a major durable goods industry which produced $1.68 billion in GDP in 2013 and accounted for 5 percent of manufacturing GDP. The sector employed 20,611 persons, or around 9.5 percent of the state's manufacturing workforce. This technical study profiles the industry's structural and economic characteristics. This study was done for the Center for Industrial Research and Service (CIRAS) at Iowa State University.


The Creative Economy In Iowa, Dave Swenson, Liesl Eathington 2017 Iowa State University

The Creative Economy In Iowa, Dave Swenson, Liesl Eathington

David Swenson

This study is an assessment of Iowa’s creative economy. It represents a broad inventory of the creative composition of the Iowa economy with an eye towards defining its size and scope, measuring how it compares with the U.S., and discerning the value of the creative economy to the larger Iowa economy. The creative economy has two important dimensions. The first is Iowa’s creative workforce. The second is Iowa’s creative industrial composition. The creative workforce is further segmented into two groups. The first, borrowing from Florida’s work (2002), is the super creative core, which is composed ...


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