The Underground Economy in the Late 1990s: Evading Taxes,or Evading Competition?

This paper studies the driving forces behind the considerable expansion of the underground economy during the late 1990s. I propose a novel explanation for this phenomenon: the sharp increase in market competition worldwide, which reduces prices and profits and drives firms into the shadow economy. Empirical evidence from a panel covering 45 countries from 1995 to 2000 shows that increased competition is indeed correlated with an expansion of the underground economy. The effect is strongest in low-tax, high-corruption countries that do not provide the public services which make it worthwhile for firms to remain official despite growing competitive pressure.     

Recent Developments at DG Competition: 2020/2021

Review of Industrial Organization - The Directorate General for Competition at the European Commission enforces competition law in the areas of antitrust, merger control, and State aid. After...     

Vertical Relations in the Presence of Competitive Recycling

This paper studies the vertical relations between a manufacturer and one or more retailers over two periods in the presence of a competitive recycling sector. In a bilateral monopoly, two-part tariffs are always efficient, i.e. the manufacturer will produce the joint-profit-maximizing output. Under downstream oligopoly, instead, retailers compete to acquire the recycled good which allows the recycling sector to appropriate some of the industry profits. Under two-part tariffs, the manufacturer has an incentive to distort her output choices to reduce this rent loss: She will discriminate among her retailers, and she will either overproduce in the second period or underproduce in the first period. Vertical restraints that restore profit maximization (e.g. loyalty rebates) will harm consumers whenever the manufacturer would overproduce otherwise.     

Smallholder dairy cattle feeding technologies and practices in Tanzania: failures,successes, challenges and prospects for sustainability

In Tanzania, milk production under smallholder farming systems is season sensitive, fluctuations of feeds in both quantity and quality being the major driver. A dry season decline in milk production of over 40% due to feed scarcity is a common phenomenon. Adoption of improved feed production, conservation and utilization technologies and practices in dairy farming communities is poor. This review work was based on a key question which states “Why is adoption of improved dairy nutrition technologies and practices in Tanzania still poor despite being promoted for decades?”. We have shown that major opportunities for curbing dry season animal feed shortage include on-farm optimization of production and use of high yielding pasture varieties including napier grass (Pennisetum purperium Schumach.) and leguminous fodder species. Crop residues in particular maize stover needs to be optimized for effective dry season feeding. The major reasons for low adoption of proven technologies include limited technical knowhow among smallholder dairy farmers augmented by limited extension services and technological costs. For enhancing sustainable uptake; we suggest promotion of on-farm research, public-private partnerships and dairy farmers’ cooperative associations. These are vital for facilitating smooth access to information, investment capital, reliable inputs and markets among the smallholder dairy farmers.     

Development of maintenance function performance measurement framework and indicators

The performance and competitiveness of manufacturing companies is dependent on the reliability, availability and productivity of their production facilities. To ensure the plant achieves the desired performance, maintenance managers need a good track of performance on maintenance process and maintenance results. This can be attained through development and implementation of a rigorously defined performance measurement framework and indicators that are able to measure important elements of maintenance function performance. The purpose of this paper is to demonstrate that performance indicators are not defined in isolation, but should be the result of a careful analysis of the interaction of the maintenance function with other organisational functions, most evidently with the production function. In this paper, a conceptual framework that provide guidelines for choosing maintenance function performance indicators is proposed. It seeks to align maintenance objectives with manufacturing and corporate objectives, and provides a link between the maintenance objectives, maintenance process/efforts and maintenance results. Based on this conceptual framework, performance indicators of the maintenance process and maintenance results are identified for each category.     

Exclusionary Pricing When Scale Matters

We consider an incumbent firm and a more efficient entrant, both offering a network good to several asymmetric buyers, and both being able to price discriminate. The good has positive value to buyers only if the network size exceeds a certain threshold. The incumbent's installed base guarantees this critical size to the incumbent, while the entrant needs to attract enough ‘new’ buyers to meet this threshold. We show that price discrimination (in the various forms it may take) reduces the set of achievable socially efficient entry equilibria, and discuss the policy implications of this result.     

Unmet need for health care during pregnancy: A French – Romanian comparison

ABSTRACT

Health inequalities emerge from birth, the early neonatal mortality and infant mortality rates being different between countries. These differences may be related to inequalities in use of health care during pregnancy. The aim of this research is to identify and compare the profiles of women who do not follow pregnancy health care recommendations in two European countries with different health systems and indicators: namely France and Romania. However, health care recommendations for pregnant women are free in the two countries. Firstly, unmet need for health care during pregnancy is observed. Secondly, our results reveal that there is a relationship between perinatal health care abandonment and several forms of inequalities (social, informational and psychological). Thirdly, the much higher probability of forgoing perinatal health care for Romanian women could be associated with financial or informational problems which seems counterintuitive because perinatal health care recommendations are free. Free coverage is too insufficient to ensure the efficiency of the perinatal health care system.