Market Performance Implications of the Transfer Price Rule

The “transfer price rule” (TPR) defines a vertical price squeeze as an input price, output price combination set by a vertically‐integrated firm monopoly producer of an essential input that would not allow the firm's downstream unit to earn at least a normal rate of return on investment in the “as‐if” case that it had to purchase the input at the price charged independent firms. In its 2009 linkLine decision, the U.S. Supreme Court rejected the TPR for the purpose of enforcing the anti‐monopolization prohibition of Section 2 of the Sherman Act. In contrast, a vertical price squeeze, defined by a TPR‐like standard, is an abuse of a dominant position under Article 102 of the Treaty on the Functioning of the European Union. In this article, we model the impact of the TPR on market performance. We find that the TPR increases consumer surplus and net social welfare if all firms remain active in the downstream market. It sometimes induces the upstream firm to refuse to supply the downstream firm, and in such cases, consumer surplus and net social welfare are reduced. The impact of the TPR on market performance thus depends on whether or not an upstream firm can refuse to supply downstream firms on terms that would offer it at least a normal rate of return on investment.     

Multi‐Market Competition,R&D,and Welfare in Oligopoly

We investigate a multi‐market Cournot model with strategic process research and development (R&D) investments wherein a multi‐market firm meets new competitors that enter one of the markets. We show that entry can enhance the total R&D expenditures of the multi‐market firm. Moreover, the incumbent's profit nonmonotonically changes as the number of entrants increases. Depending on the fixed entry costs and R&D technologies, both insufficient and excess entry can appear. Our results imply that diversification of their products can be a useful strategy for firms.     

The China shock and job reallocation in Japan

This study investigates the characteristics of manufacturing job reallocation in Japan induced by import shocks from China during 1996–2016. Three types of import shocks are considered: direct, upstream, and downstream. Some salient features of job reallocation include decrease in total jobs from direct import, increase in small establishments’ jobs from downstream import, and job changes mainly induced establishments’ entry and exit. The sizeable difference of implied job changes in industry-level analysis and those in region-level analysis attributes to the local reallocation and aggregate demand effects determined by regional characteristics. The total job effect of three import shocks is negative in all cases examined. The method of decomposing job changes into detailed job flows and further into industry and regional factors, proposed in this study, enabled obtaining a clearer view of job reallocation and how import shocks travel through labor market.     

Upstream privatization and downstream licensing

This study attempts to investigate the impact of downstream foreign licensing on upstream privatization policy in a vertically related market, in which a public firm and a domestic private firm supply exclusively to downstream domestic and foreign firms, respectively. We show that downstream licensing occurs when the cost differential between downstream duopolists is small, and the optimal strategy under licensing is upstream partial privatization. In addition, downstream foreign licensing facilitates upstream privatization. We further show that downstream licensing improves (reduces) local welfare when the cost differential is large (small).     

The role of foreign direct investment in the host-country firm selection process: firm-level evidence from Slovenian manufacturing

This paper examines the role of inward foreign direct investment (FDI) in firm selection processes in the Slovenian manufacturing sector in the 1994–2003 period. It adopts the firm dynamics framework that allows testing of selection effects directly by assessing the impact of foreign firms’ activity on the probability of exiting of local firms (crowding out). The results show that intra-industry productivity spillover effects offset only a minor part of the competition pressure which results from foreign firm entry, hence incumbent firms experience a drop in their survival probability upon a foreign firm’s entry within a particular industry. This result is driven by foreign firm entry of the greenfield type, as entry through the acquisition of existing firms has no significant effect. The strength of the crowding-out effect decreases with the incumbent firm’s export propensity. There is no significant evidence that inward FDI would stimulate the selection process through backward linkages in the upstream supplying industries, whereas foreign firms’ activity reduces the exit probability of downstream local customers (through forward linkages).     

Long-Term Effects of Labour Market Entry Conditions: The Case of Korea

This study investigates the effects of labour market conditions at the time of graduation, proxied by the local unemployment rate, on long-term family and labour market outcomes in Korea. The examination yields four main findings. Labour market entry conditions have strong and persistent effects among high school graduates. Male college graduates have a persistently lower probability of working at large firms if the demand for local labour shrinks at the time of graduation. Self-employment can be persistently hampered by adverse economic conditions at graduation. Family formation and childbearing are temporarily affected by labour market entry conditions, especially for less educated women. The first three findings highlight the notable segmentation of the Korean labour market into protected jobs in large firms – mostly part of business groups (chaebols) – and unprotected jobs.     

Outsourcing and Vertical Integration in a Competitive Industry

We develop a partial equilibrium, perfectly competitive framework of a (potentially) vertically integrated industry. There are three types of firms: upstream firms that use primary factors to produce an intermediate good; downstream firms that use primary factors and intermediate goods to produce a final good; and vertically integrated firms that do both. We establish conditions under which vertically integrated firms exist and outsource (part of) the production of the intermediate input. We study the changes in industry configurations resulting from changes in costs and demand.     

What role should public firms play in the upstream market?

We investigate the upstream public firm's desirable option of production timing in the vertically related upstream market. We find that multiple equilibria may exist, including the Cournot-type and Stackelberg-type, with different degrees of privatization in the presence of upstream firms' efficiency gap. These equilibrium outcomes are also influenced by the intensity of downstream market competition. We further show the corresponding optimal degree of privatization in different phases of gradual privatization.     

跨国公司对东道国企业技术创新的影响

在下游企业顺序进入市场条件下,本文分析了跨国公司对于上游企业创新动机的影响。我们的研究表明:上游企业的创新投入既取决于其国有股的比重又取决于下游企业的国别属性以及市场势力。具体而言,如果上游企业是一个私营企业,那么下游企业的国别属性不影响其研发投入。相反,倘若上游企业是一个纯粹的国有企业,那么只有当下游企业均为国外企业时,其研发投入不足,在其他情况下,上游企业的研发投入相同。假如上游企业是一个部分国有企业,那么下游跨国公司的市场势力越大,其研发动力越低。     

Competing with Costco and Sam's Club: Warehouse Club Entry and Grocery Prices

Prior research shows that grocery stores reduce prices to compete with Walmart Supercenters. This study finds evidence that the competitive effects of two other big‐box retailers—Costco and Walmart‐owned Sam's Club—are quite different. Using city‐level panel grocery price data matched with a unique data set on Walmart and warehouse club locations, we find that Costco entry is associated with higher grocery prices at incumbent retailers and that the effect is strongest in cities with small populations and high grocery store densities. This is consistent with incumbents competing with Costco along nonprice dimensions, such as product quality or quality of the shopping experience. We find no evidence that Sam's Club entry affects grocery stores' prices, consistent with Sam's Club's focus on small businesses instead of consumers.     

我国大豆贸易的现状及其影响分析

文章认为,我国自加入世界贸易组织以来,大豆贸易逆差越来越大。大豆进口量的逐年增长已经对我国大豆的本地种植带来了极大的负面影响,由此引发的有关大豆上下游产业也受到了相当大的冲击。从长远看,这些影响会对我国大豆的相关产业安全带来威胁。为此,文章呼吁我国应从产业安全的战略高度出发,针对大豆产业链的各个环节制定出相应对策,以有效保护我国大豆产业健康发展。     

上下游企业相似商品的最优反倾销税率模型

作为政府的重要决策,反倾销税率一直被学术界广泛研究。文章基于两国存在上下游企业相似商品贸易的假设,建立了在完全信息静态博弈下的反倾销税率定价优化模型。通过Cournot-Nash均衡以及逆向归纳法,发现了优化的反倾销税率与市场的容量,商品相关性以及国外上下游企业的边际成本这四个因素有关,但与本国上下游企业的边际成本无关。从而得出在成本变动或者市场容量变动的情况下,政府应如何制定反倾销税率来保证本国社会福利最大化。     

Multinational corporations and domestic market structure: The case of Greek manufacturing industries

Conclusions In this paper we examined the potential of MNCs to give rise or to promote concentrated markets in a host country. Foreign presence in the form of MNCs affectsdirectly the market structure of the economy by in-creasing both the relative inequalities in the size distributions of firms (entropy) and the level of absolute concentration (Herfindahl-CR4). MNCs tend to populate capital intensive sectors and may also account for a potentialindirect stimulation on the concentration process through their effects on domestic barriers to entry. Industries characterised by such horizontal FDI are likely to be able to earn and maintain supra-normal profits in the domestic market. However, the effective curb of competition caused by MNCs did not show uneven distribution of gains in profitability to be present in the market for a sample of 100 large MNCs and local firms. We should suggest that concentration and other market imperfections may be the basic factor determining profitability in Greece,not multinationality per se. Moreover, the potential indirect influence of MNCs on domestic barriers may act as an agent for promoting structural changes, especially in the capital intensive sector.     

Economic Regulation in the Consumer Loans Market

Atlantic Economic Journal - This paper models a consumer loan market with a vertical structure where an upstream monopolist supplies funds to downstream nonbanks. The nonbanks supply funds to...     

CSR in an Asymmetric Duopoly with Environmental Externality

We investigate a linear state differential game describing an asymmetric Cournot duopoly with capacity accumulation á la Ramsey and a negative environmental externality (pollution), in which one of the firms has adopted corporate social responsibility (CSR) in its statute, and therefore includes consumer surplus and the environmental effects of production in its objective function. If the market is sufficiently large, the CSR firm sells more, accumulates more capital, and earns higher profits than its profit‐seeking rival.     

Linking IDC finance to structural transformation and inclusivity in post-apartheid South Africa

ABSTRACT

The need for structural transformation and inclusivity in South Africa is urgent, given poor economic growth, employment and equality outcomes. This article examines the role of South Africa’s main industrial finance institution – the Industrial Development Corporation (IDC) – in providing finance for structural transformation and inclusive economic growth post-apartheid. We find that the IDC’s funding has been concentrated in capital-intensive upstream sectors of the economy, with limited concessional finance to facilitate meaningful entry of SMEs into high-value and labour-absorptive downstream sectors. The IDC’s funding model (in being a self-sustainable institution) is a significant constraining factor in this regard. Furthermore, the lack of a purposeful integrated industrial policy strategy which directs investments clearly means that IDC’s funding priorities are not clearly defined.     

ASYMMETRIC PRICE TRANSMISSION AND MARKET CONCENTRATION: AN INVESTIGATION INTO FOUR SOUTH AFRICAN AGRO-FOOD INDUSTRIES

相似文献   

产业价值链视角的纵向研究联合体研发模式研究——以上汽集团与通用(中国)纵向研究联合体为例

价值链不仅存在于企业内部,还存在于企业与企业之间。基于产业价值链的视角,文章主张在上下游企业间建立纵向研究联合体(RJVs),整合松散的研发资源。通过构建博弈模型,分析了上游企业不进行产品研发、上游企业独立研发和建立纵向研究联合体合作研发三种情形下的上下游企业得益情况,指出边际成本下降程度、参与合作的下游企业数量是影响参加研究联合体企业利润的重要因素,从而阐释了下游企业参与纵向研究联合体的内在动机。最后,文章以上汽集团和通用(中国)纵向研究联合体研发联姻的PATAC为例,进行了实证研究。     

Testing for horizontal and vertical foreign investment spillovers in China, 1998–2007

As with many developing countries, the Chinese government hopes that knowledge brought by multinationals will spill over to domestic industries and increase their productivity. In this paper, we show that foreign investment originating outside of Hong Kong, Macau, and Taiwan has positive effects on individual firm level productivity, while foreign investment from HKMT firms does not. We also test for both horizontal (within the same industry) and vertical (upstream or downstream) linkages from foreign investment. Using a manufacturing firm-level panel for 1998 through 2007, we find zero or weak positive horizontal externalities. However, our results show that foreign direct investment (FDI) has generated positive productivity spillovers to domestic firms via backward linkages (the contacts between foreign affiliates and their local suppliers in downstream sectors) as well as forward linkages (between foreign suppliers and their local buyers in the upstream sectors).     

汽车供应链广告策略博弈研究

新能源汽车的研发、市场投入使得现有的汽车品牌竞争愈演愈烈。为加强汽车供应链上下游间合作,首先提出汽车制造商在投入全国性广告费用的同时为零售商分摊地方性广告费用;其次,基于stackelberg博弈和纳什博弈模型,分别构造函数分析制造商最优的广告投入和分摊比例及零售商的最优广告投入并分析具体变量之间的关系。最后总结并提出汽车供应链上下游需建立信任关系,加强广告合作;制造商应合理决策广告分摊比例,实现自身与零售商双赢局面。