Market Power and Patent Strategies: Evidence from Renaissance Venice

This paper exploits the introduction of the first regularized patent system, which appeared in the Venetian Republic in 1474, to examine the factors shaping inventors’ propensity to use a new form of intellectual property. We combine detailed information on craft guilds and patents in Renaissance Venice and show a negative association between patenting activity and guild statutory norms that strongly restricted entry and price competition. Our analysis shows that the heterogeneity in patenting activity documented by the industrial organization literature is not a special feature of modern technologies, but is rather a persistent phenomenon affected by market power.     

Efficiency and patterns of service mix in airport companies: An input distance function approach

In this paper an input distance function approach is used to evaluate efficiency and technological characteristics of Italian airport companies for the period 2000–2005. This approach is robust to deviations from neoclassical paradigm in terms of cost-minimizing behavior. Duality relationship between the input distance function and the shadow cost function is exploited to derive cost complementarities among outputs. Empirical findings are used to discuss the economic implications connected to changes in airport organization, involving in particular outsourcing of handling operations and development of commercial activities.     

Can information alone change behavior? Response to arsenic contamination of groundwater in Bangladesh

We study how effectively information induces Bangladeshi households to avoid a health risk. The response to information is large and rapid; knowing that the household's well water has an unsafe concentration of arsenic raises the probability that the household changes to another well within one year by 0.37. Households who change wells increase the time spent obtaining water fifteen-fold. We identify a causal effect of information, since incidence of arsenic is uncorrelated with household characteristics. Our door-to-door information campaign provides well-specific arsenic levels without which behavior does not change. Media communicate general information about arsenic less expensively and no less effectively.     

When quality signals talk: Evidence from the Turin hotel industry

This study analyzes the relationship between quality signals and price setting through the application of hedonic price functions. The model proposals also include variables relating to land use policies and tourism development strategies. A simultaneous equation model endogenously estimates quality signals. This method is appropriate for analyzing emerging urban destinations, as characterized by the presence of an expanding hotel industry. The results are based on a dataset of 145 hotels in Turin, Italy. The empirical findings reveal that reputation-based quality signals help explain tariff levels. Price proposals also include a premium for quality assured hotels, defining some limits of the current hotel classification system. The empirical evidence has significant marketing implications for the hospitality industry’s competitiveness, since the results clarify the impact of quality signals on price level.     

Shapley and Scarf housing markets with consumption externalities

We introduce externalities into the classical model by Shapley and Scarf; that is, agents care about others and their preferences are defined over allocations rather than over single indivisible goods. After collecting some results about the nonexistence of several cooperative solutions, we focus on stable allocations and propose domains of preferences that can guarantee that they both exist and form a stable set à la von Neumann and Morgenstern.     

Product Market Competition,Executive Compensation,and CEO Family Ties

Review of Industrial Organization - This paper analyzes the interaction between product market competition and family ties on the structure of CEO pay, in a panel of publicly listed family firms....     

Connections and performance in bankers’ turnover

In this paper we study the impact of the connections of the top executives (Presidents, CEOs and General Managers) of Italian banks on their turnover and on bank performance. We measure managers’ connections by the kilometer distance between the province of the bank's headquarter and the manager's province of birth. We show that top managers tend to be local in the sense that the distribution of this distance is heavily skewed towards zero. On the basis of this evidence we investigate whether connections affect the duration of the appointment at the bank, and whether connections entrench managers at the expense of the bank's performance. We find that connections generally decrease the probability of bank manager’s turnover, and that the positive effect of performance on tenure is strongly attenuated once connections are taken into account. Furthermore we find that for any bank type performance does not increase with connections. On the contrary, we show that having connected managers hurts performance in Mutual, Cooperative and Rural banks. Overall these findings suggest that connections are collusion devices to share and maintain rents at the expenses of bank performance.     

Regulating Public Transit Networks: How do Urban‐Intercity Diversification and Speed‐up Measures Affect Firms’ Cost Performance?

Abstract Empirical studies on the cost structure of Public Transit Networks are mainly based on specialized firms providing urban or intercity services. In this study we estimate a translogarithmic variable cost function to assess the behaviour of returns to scale and the impact of network characteristics. The analysis is based on a sample of 45 Italian municipal companies observed from 1996 to 1998 and including both specialized and mixed transit operators. Results confirm previous evidence on the existence of natural monopoly in the industry and support a regulation introducing competitive tenders to access to the market. In addition, we provide insights about the advantages associated with urban‐intercity diversification and with the improvement of network commercial speed. Cost benefits can then be achieved by promoting mergers between neighbouring firms, so as to create new companies operating on integrated local networks and supplying in combination urban and intercity public transport. Implications of such a strategy for the design of tender mechanisms are also underlined, together with the need for a regulatory policy which takes more care of speed‐up measures.     

On the regulation of spatial externalities: coexistence between GM and conventional crops in the EU and the ‘newcomer principle’*

Pollen‐mediated gene flow is one of the main concerns associated with the introduction of genetically modified (GM) crops. Should a premium for non‐GM varieties emerge on the market, ‘contamination’ by GM pollen would generate a revenue loss for growers of non‐GM varieties. This paper analyses the problem of pollen‐mediated gene flow as a particular type of production externality. The model, although simple, provides useful insights into coexistence policies. Following on from this and taking GM herbicide‐tolerant oilseed rape (Brassica napus) as a model crop, a Monte Carlo simulation is used to generate data and then estimate the effect of several important policy variables (including width of buffer zones and spatial aggregation) on the magnitude of the externality associated with pollen‐mediated gene flow.