Suchergebnisse

The theoretically necessary and sufficient condition for the correspondence between 'revealed' comparative advantage and pre-trade relative prices derived by Hillman (1980) is analyzed empirically for virtually all countries of the world over an extended period of time. This yields 10 stylized facts, including that (i) violations of the Hillman condition are small as a share of the number of observations, but substantial as a share of the value of world exports, (ii) violations occur relatively frequently in the period 1970 – 1984 and more rarely in the period 1985 – 1997, and (iii) violations occur foremost in primary product and natural-resource intensive sectors, and for countries in Africa, the Middle East, Latin America, and Central and Eastern Europe. An additional bonus of verifying the Hillman condition in empirical research is its ability to identify erroneously classified trade flows.

Abstract
Intuitively, extending the period of repose for price fixing agreements enhances the effectiveness of competition policy enforcement. This paper proves this intuition wrong. As extending the repose period reduces cartel members' defection payoff while it leaves unaltered expected compliance profits, it induces cartels to be more stable internally.

Abstract
Building on the framework developed by Qiu (1997) we investigate the influence of product market competition on incentives to invest in cooperative R&D. For that we disentangle the three components that make up the combined-profits externality. The strategic component is always negative and the size component is always positive. The spillover component is negative (positive) with Bertrand (Cournot) competition. Cournot competition thus yields more cooperative R&D, which could drive the Cournot-Nash price below the Bertrand-Nash price. Our decomposition also explains why, under Cournot competition, cooperative R&D exceeds non-cooperative R&D only if spillovers are "high enough."

Recent laboratory experiments support the popular view that the introduction of corporate leniency programs has significantly decreased cartel activity. The design of these repeated game experiments however is such that engaging in illegal price discussions is the only way for subjects to avoid the one-shot competitive equilibrium. Subjects in the experiment of this paper have multiple feasible Nash equilibrium strategies to avoid the competitive equilibrium. These strategies differ in the difficulty of the coordination problem they have to solve. The experimental results show that if the efforts of the antitrust authority and the leniency program are directed exclusively to the most straightforward collusive scheme, subjects manage to switch to a more intricate form of coordination. This shift from overt collusion to tacit collusion questions the acclaimed success of corporate leniency programs.

The number of cartels detected in the United States and in Europe has increased considerably since the introduction of corporate leniency programs in antitrust legislation. It cannot, however, be ruled out that this apparent success results in part from increased cartel activity. We explore the effects of corporate leniency programs on pricing and cartel activity by use of an experiment. We find that in the lab (i) fewer cartels are established when a leniency program is in place, and (ii) cartels that do exist are less successful in charging prices above the static Nash equilibrium price and have lower survival rates.

This paper describes a classroom exercise that illustrates the investment incentives facing firms when technological spillovers are present. The game involves two stages in which student "sellers" first make investment decisions then production decisions. The classroom game can be used to motivate discussions of research joint ventures, the free-rider problem, collusion, and antitrust policy regarding research and development.