R&D Spillovers and Location Choice under Cournot Rivalry

A model of location choice by Cournot oligopolists is presented, under the assumption that R&D spillovers depend on the distance between firms. It is shown that a variety of patterns emerge. Agglomeration is optimal under certain assumptions. Geographical dispersion in a two-dimensional plane is another possible outcome.     

Oligopolistic Trade and Competition in Wages Legislations

Wages legislation, or selective enforcement of such legislation, may be used to enhance the competitiveness of domestic firms. We show that, if domestic and foreign firms produce close substitutes and are Bertrand rivals, then wages legislation and enforcement display the characteristics of a Prisoner's Dilemma game. Other scenarios are also investigated.
JEL Classification: F13     

Does shareholder primacy lead to a decline in managerial accountability?

Shareholder primacy is increasingly considered to be the mosteffective way to foster managerial (corporate) accountability.Contrary to this now standard argument, we consider that shareholderprimacy, rather than gatekeeper failure, is directly responsiblefor the multiplication of accounting irregularities and thedramatic increase in executive compensations. To defend thisthesis, we propose a new reading of Berle and Means (1932),Galbraith (1973) and Alchian and Demsetz (1972), stressing thelogical failure of a control of the business firm provided forby stock markets: the implementation of shareholder primacyimplies a partial disconnection between access to internal knowledgeand empowerment. In turn, this disconnection favours deceptivebehaviours on the part of corporate insiders. Empirical evidencemostly based on Enron-era financial scandals illustrates ourargument.     

An inquiry into the Ramsey-Hotelling connection

Ramsey’s 1928 Ramsey, F. P. 1928. “A Mathematical Theory of Saving.” Economic Journal 38 (152): 543–559. doi:10.2307/2224098[Crossref] , [Google Scholar] paper on saving and Hotelling’s 1931 article on exhaustible resources are considered to be two seminal contributions in economic dynamics. They have been associated because of their temporal proximity, use of the calculus of variations, and because of Hotelling’s citation of Ramsey. This connection however needs to be precisely investigated and characterized. On the basis of archival material, this paper shows that, on the interpersonal and theoretical ground, the connection is quite thin, but that significant parallels are found in Ramsey’s and Hotelling’s expectations with mathematical economics for the progress of science and for informing public decision.     

Making Partner*

Associates need reputation and financial resources to make partner at law firms, consultancies, and venture capital organizations. We provide a theory for how this prospect influences the business risk strategy they pursue and their execution effort. In our model, business risk affects how reputation evolves and the benchmark reputation for making partner through the impact of execution effort on the financial resources accumulated. We show that when business risk is observable, associates with good reputation take on high business risk, as opposed to low business risk, in order to protect their reputation. We also show that opening partner positions decreases the effort incentives of the associates with the best reputation. Finally, we conjecture that wage dispersion at the associate level should be higher when business risk is unobservable.     

Changes in the firms behavior after the opening of markets of allowances

This paper focuses on the influence on the general equilibrium of an economy of the opening of markets of allowances, such as the European Union Emission Trading Scheme. Assuming there existed an equilibrium before the opening of allowances’ markets, we describe the changes in the firms behavior which guarantee that an equilibrium can be reached in the enlarged economy. Hence we describe under which conditions the economy can undergo the opening of markets of allowances. This paper is a substantial improvement of previous work in collaboration with Alexandrine Jamin (Jamin and Mandel 2006).The author is grateful to Professor Jean-Marc Bonnisseau for his guidance and to an anonymous referee whose comments led to substantial improvements of the paper.     

Excessive continuation and dynamic agency costs of debt

This paper analyses the incentives of the equityholders of a leveraged company to shut it down in a continuous time, stochastic environment. Keeping the firm as an ongoing concern has an option value but equity and debt holders value it differently. Equityholders’ decisions exhibit excessive continuation and reduce firm's value. Using a compound exchange option approach, we characterise the resulting agency costs of debt, derive the “price” of these costs and analyse their dynamics. We also show how agency costs can be reduced by the design of debt.     

Capital utilization and retirement

This empirical analysis assesses the determinants of firms’ capital retirement. Particular attention is paid to the impact of the business cycle and the capital usage intensity. Compared to previous studies, we directly control for the capital utilization and disentangle the short-run mechanisms from the long-run ones. The analysis is carried out with an original and large firm-level dataset. The main results of the analysis may be summarized as follows: (i) the retirement rate increases during slowdowns and decreases during booms. This corresponds to a countercyclical capital retirement; (ii) the capital retirement rate increases with the capital usage intensity in the long run. This corresponds to a wear and tear effect, which is small compared to the countercyclical one; (iii) the capital retirement rate increases with the average age of capital; (iv) the profit rate and the wage cost per capita do not have a significant impact on the retirement rate.     

Treatment discontinuation of long-acting injectables or oral atypical antipsychotics among Medicaid recipients with schizophrenia

Abstract

Aims: Among patients with schizophrenia, poor adherence and persistence with oral atypical antipsychotics (OAA) often results in relapse and hospitalization. Second-generation antipsychotic long-acting injectables (SGA LAI) have demonstrated higher adherence than first-generation antipsychotic LAI and OAA therapies. This study aimed to determine whether SGA LAIs are associated with better persistency compared to OAA among Medicaid recipients with schizophrenia.

Materials and methods: From the MarketScan Medicaid Database (January 1, 2010–June 30, 2016), patients aged ≥18?years with schizophrenia and ≥2 pharmacy claims more than 90?days apart for the same SGA LAI or OAA were selected. New users of the specific antipsychotic agent were classified, based on their index agent, as: OAA, paliperidone palmitate LAI (PPLAI), aripiprazole LAI (ALAI), and risperidone LAI (RLAI). Discontinuation during 1 year of follow-up was defined as a?≥?60-day gap in the index OAA or SGA LAI medication past the exhaustion of the previous claim’s supply. Inverse probability of treatment weights (IPTW) balanced the cohort characteristics, and weight outliers (<0.1 or >0.9) were excluded. IPTW-weighted Cox proportional hazards regression estimated hazard ratios for discontinuation.

Results: Cohorts included 7,029 OAA, 4,302 PPLAI, 586 ALAI, and 1,456 RLAI patients. Mean age was 38.0–41.0?years and 44.0–46.6% were female. Persistence was significantly longer in the SGA LAI cohorts than in the OAA cohort. Adjusted hazard ratios (95% confidence intervals) for discontinuation were 0.60 (0.56–0.64) for PPLAI, 0.69 (0.60–0.79) for ALAI, and 0.70 (0.64–0.77) for RLAI vs OAA.

Limitations: Results may not be generalizable to patients covered by commercial or Medicare insurance, and limitations inherent to any claims-based retrospective analysis apply.

Conclusions: SGA LAI may be a valuable option for treating schizophrenia given the improvement in persistence.