Manchester School最新文献

In the presence of network externalities, this study examines the endogenous delegation structure in an export rivalry market with import tariff under Bertrand competition. Contrast to previous works, we show that (i) with strong (weak) network externalities, choosing delegation for exporters is a dominant strategy, which implies the managerial delegation for output expansion (restriction) is socially desirable; (ii) with intermediate network externalities, the exporters choose no delegation in equilibrium; (iii) compared to no delegation, a smaller import tariff further increases both exporters incentives, consumer surplus and social welfare to choose delegation for output expansion unless the strength of network externalities is small; and (iv) hence, two contrasting prisoner’s dilemmas occur in the Bertrand competition when the network effect is medium-sized.

I analyse the relationship between price discrimination, with respect to the package size of the product, and market concentration in the liquid laundry detergent market. Specifically, I study how quantity discounts change with market concentration. I estimate a fixed effects model and find that this relationship is non-monotonic and I provide evidence that it is U-shaped. These results suggest that firms offer more quantity discounts in less and more concentrated markets, while they offer less quantity discounts in moderately concentrated markets.

When there is asymmetry in the market size information held by an R&D firm outside a market that possesses new technology for lowering production costs, along with a monopoly firm that engages in production activities inside the market, the producing firm has an incentive to make its market size look smaller to reduce licensing fees. Fixed-fee licensing is desirable for R&D firms in the absence of information asymmetry, but royalty licensing and a mixture of fees and royalties can work as a means to resolve information asymmetry. Using a dynamic model of signaling, this study shows that fixed-fee licensing is adopted when the level of a new technology is large or small, while royalty licensing is adopted when the level is moderate.

Consumer stockpiling can result in biased empirical estimates of own- and cross-price elasticities of demand with significant implications for a range of policy issues. To further the theoretical understanding of such biases, I develop a simple, yet general theoretical framework. For any given demand and prices, I show both the own- and cross-price elasticities biases can be over- or underestimated depending upon a single intuitive condition. I then illustrate the importance of these insights by applying them to some example applications, including the measurement of market power and the estimated effects of tax increases on consumption.

We compare content provision in the media Internet market under net neutrality and no net neutrality. We show that content provision in the two regimes depends on the one hand on the level of content differentiation, and on the other hand on the relation between network capacity and network traffic. If content is not very differentiated, the net neutrality regime provides more content than the no net neutrality regime. In addition, in the no net neutrality regime, a monopolist can arise. If content is sufficiently differentiated, but network capacity is not large relatively to network traffic, the net neutrality regime again provides more content than the no net neutrality regime. The reason is that when network capacity is small relative to network traffic, the no net neutrality regime reduces competition. This is so since the Content Provider with priority has an advantage over the Content Provider with no priority, which allows the former to attract consumers even without investing in content, while for the latter investment in content becomes ineffective to attract demand.

On any given weekend, over a fifth of the UK labour force is at work, while more than half of working adults report working at the weekend at least some of the time. This is despite the fact that weekends are conventionally set aside as rest days. The question that this paper addresses is: does this matter? This paper adds to the literature by using two large panel datasets to analyse the effects of weekend working on eight different measures of subjective well-being in the UK. I find that weekend working has a significant impact on how satisfied people are with the amount of leisure time they have, with the results suggesting that avoiding weekend working is equivalent to working six fewer hours per week. Moreover, people working at the weekend report significantly lower happiness yesterday than non-weekend workers. While weekend workers also experience lower levels of life satisfaction than non-weekend workers, this difference disappears when controlling for unobserved heterogeneity between individuals. This suggests that there is no evidence that weekend working causes people to be worse off overall.

The paper studies tax evasion in an evolutionary setting. In addition to standard variables such as the fine individuals may have to pay if found guilty or the probability of being audited, agents’ inclination to engage in tax evasion may also be affected by social interactions. Moreover, expected payoffs may include reputational costs or rewards awarded by society after an individual is audited. The paper shows how (i) social norms may play a very important role in defining the long-run evolution of tax evasion and, consequently, that (ii) policymakers should consider reforms that would increase social awareness and information rather than more (financially and politically) expensive traditional auditing instruments; in addition, (iii) fiscal/auditing policies should be carefully tailored to the particular economic and social setting in place in a country.

This paper focuses on economic policy uncertainty spillovers across Europe, before and after the outburst of the Eurozone crisis, using data for seven Eurozone countries for the period 2003–2019. At first, we analyze the spillovers of uncertainty in Europe via the estimation of the Diebold-Yilmaz spillover index. The results indicate that uncertainty connectedness was 50.5% before the crisis, while it dropped to 30.6% afterwards indicating a sharp drop in uncertainty spillovers across the seven Eurozone countries. We also find that the importance of domestic causes in national uncertainty has increased during the crisis at the expense of imported factors. Dynamic net spillovers reveal that core Eurozone countries are uncertainty exporters before the crisis, while periphery countries transmit uncertainty to other countries during the crisis. An examination of the country which suffered the most during the crisis, using impulse response analysis, reveals that the Greek macroeconomic indicators (stock market, GDP, unemployment, and the Economic Sentiment Index) were affected more by domestic, rather than European uncertainty. The highest responses are indicated during the crisis. Overall, there is positive interdependence between Greek and European uncertainty, which diminishes during the crisis.

The aim of this paper is to analyze whether parents' fertility behavior may be an important determinant of the future fertility outcomes of their children in Spain. To address this issue, we use data from the Survey of Living Conditions. Our results confirm the intergenerational transmission of fertility behavior in Spain. The higher the parents’ number of children, the higher the number of children that individuals have. We find that individuals from regions where parents have few children may have 0.02 fewer children, because of differences in parental fertility, than those individuals living in regions whose parents have a large number of children, which represents 7% of the difference in fertility across regions.

This paper considers the problem of allocating resources between economic goods and military goods in a contest model. We characterize the equilibrium and its stability in both cases where the two states' economic goods are substitutes and complements, and compare the outcomes. If the two states' economic goods are substitutes, there may exist multiple equilibria including at least one unstable equilibrium when a state has a comparative advantage in a sector. Without any such comparative advantage, a unique stable equilibrium results in which both states build-up the same level of military goods regardless of their relative sizes. A unique stable equilibrium also emerges if the two states' economic goods are complements with Cobb–Douglas utility characteristics. These results suggest that greater economic interdependence due to the complementarity slows down the arms races, and help stabilize the system. If the contest between the two states is a winner-take-all all-pay auction, there exists a pure strategy equilibrium. In this equilibrium, the state with an absolute advantage in the military sector takes all the resources by spending slightly more in the military sector than the other state. Such a finding contradicts most of the standard all-pay auctions, in which only a mixed strategy equilibrium exists.