Antitrust & Competition Policy Blog

Editor: D. Daniel Sokol
University of Florida
Levin College of Law

A Member of the Law Professor Blogs Network

Tuesday, October 5, 2010

WSJ Editorial on Reverse Patent Settlements

Posted by D. Daniel Sokol

The Wall Street Journal has an editorial titled The 'Pay for Delay' Rap: The drug industry, the FTC and overzealous antitrust. I think the title gives you a sense of how they come out.

October 5, 2010 | Permalink | Comments (0) | TrackBack (0)

Information sharing in contests

Posted by D. Daniel Sokol

Dan Kovenock (University of Iowa), Florian Morath (Max Planck Institute of Intellectual Property, Competition and Tax Law), and Johannes Münster (Free University of Berlin) address Information sharing in contests.

ABSTRACT: We study the incentives to share private information ahead of contests, such as markets with promotional competition, procurement contests, or R&D. We consider the cases where firms have (i) independent values and (ii) common values of winning the contest. In both cases, when decisions to share information are made independently, sharing information is strictly dominated. With independent values, an industry-wide agreement to share information can arise in equilbrium. Expected effort is lower with than without information sharing. With common values, an industry-wide agreement to share information never arises in equilibrium. Expected effort is higher with than without information sharing.

October 5, 2010 | Permalink | Comments (0) | TrackBack (0)

Monday, October 4, 2010

Exploding offers and buy-now discounts

Posted by D. Daniel Sokol

Mark Armstrong University College London - Economics and Jidong Zhou University College London - Economics discuss Exploding offers and buy-now discounts.

A common sales tactic is for a seller to encourage a potential customer to make her purchase decision quickly. We consider a market with sequential consumer search in which firms often encourage first-time visitors to buy immediately, either by making an "exploding offer" (which permits no return once the consumer leaves) or by offering a "buy-now discount" (which makes the price paid for immediate purchase lower than the regular price). Prices often increase when these policies are used. If firms cannot commit to their sales policy, the outcome depends on whether consumer incur an intrinsic cost of returning to a firm: if there is no such return cost, it is often an equilibrium for firms to offer a uniform price to both first-time and returning visitors; if the return cost is positive, however, firms are forced to make exploding offers.

October 4, 2010 | Permalink | Comments (0) | TrackBack (0)

Exclusive Dealing and the Market Power of Buyers

Posted by D. Daniel Sokol

Ryoko Oki (Graduate School of Economics, University of Tokyo) and Noriyuki Yanagawa (Faculty of Economics, University of Tokyo) discuss Exclusive Dealing and the Market Power of Buyers.

ABSTRACT: This paper examines the effects of exclusive dealing contracts offered by an incumbent distributor. The effectiveness of exclusive dealing contracts offered by distributors is quite different from those offered by incumbent manufacturers. The traditional literature has focused solely on exclusive dealing contracts made by incumbent manufacturers and has derived multiple equilibria within homogeneous price competition models. In contrast, this paper asserts that exclusive dealing contracts made by a distributor generate a unique equilibrium and that an efficient entrant must be excluded under the equilibrium as long as distributors have sufficient bargaining power.

October 4, 2010 | Permalink | Comments (0) | TrackBack (0)

Monopolization Through Acquisitions in Multimarket Oligopolies

Posted by D. Daniel Sokol

Ray Chaudhuri, A. (Tilburg University, Center for Economic Research) discusses Monopolization Through Acquisitions in Multimarket Oligopolies.

ABSTRACT: This paper shows that, under Cournot competition, monopolization through acquisitions is more likely to occur in industries where firms serve multiple segmented markets rather than a single integrated market, given that cost functions are strictly convex. Under segmented markets, within a two-country model, the paper shows that if a multinational firm acquires a local …rm in one of the markets, the product price in that market rises but the product price in the other falls. This decreases the profit that each local firm would obtain if it unilaterally remained outside a merger to monopoly, making it cheaper to acquire. This reverses the well established result in the existing merger literature, which focuses on the case where an industry serves a single integrated market. Moreover, the paper shows that the sum of consumer surplus across the countries may rise in response to an acquisition despite the absence of any synergies, which existing literature shows is not possible in a single integrated market.

October 4, 2010 | Permalink | Comments (0) | TrackBack (0)

AAI's Future of Private Antitrust Enforcement Conference

Posted by D. Daniel Sokol

 

Register for AAI's Future of Private Antitrust Enforcement Conference

 

Where:

National Press Club Ballroom
529 14th St. NW, 13th Floor
Holeman Lounge
Washington, DC 20045

Driving Directions

When:
Tuesday December 7, 2010 from 9:00 AM to 4:30 PM EST
Add to my calendar

 

Greetings!

Since 2007, this event has served as a vehicle for the antitrust community to come together to network and to obtain an updated and comprehensive profile of private enforcement as a business.

This year's program will cover some of the most current and relevant issues in antitrust, including Congress's action on ACPERA, Iqbal's expansion of Twombly's reach, interpretations of FTAIA, and the ongoing challenges to class certification.


Register Now!

Complete agenda is available at www.antitrustinstitute.org.


Tuition is $50 for early registration (before November 1) and $100 for regular registration.

Thank you for your attention, we you look forward to seeing you on December 7.

 

Sincerely,

 

Bert Foer

American Antitrust Institute

aai@antitrustinstitute.org

October 4, 2010 | Permalink | Comments (0) | TrackBack (0)

Association of Competition Economics Annual Conference: November 11th and 12th 2010 at UEA in Norwich, UK

Posted by D. Daniel Sokol

ACE Annual Conference: Draft Programme
November 11th and 12th 2010 at UEA in Norwich, UK
More: http://www.uea.ac.uk/ccp and http://www.competitioneconomics.org


1 Topic: The role of UPP in Merger Evaluation All Chair: Dr. Peter Davis (CC) Professor Joe Farrell (FTC and Berkeley) Professor Ariel Pakes (Harvard) Dr. Amelia Fletcher (OFT) Dr. Greg Leonard (NERA)

2 Article 102: Tine/Synnøve Finden Norway Chair: Professor Peter Møllgaard (Copenhagen Business School) Professor Nils-Henrik Mørch von der Fehr (Oslo) Professor Tommy S. Gabrielsen (Bergen) Professor Morten Hviid (CCP)

3 Mergers: Convertible car-top production: Edscha/Webasto and Karmann/Magna Germany Chair: Professor Konrad Stahl (Mannheim) Dr. Cristian Ewald (Bundeskartellamt) Professor Theo Normann (Goethe University Frankfurt) Dr. Rainer Nitsch (ESMT)

4 Article 101: Oneworld Airline Alliance EU Chair: tbd Dr. Szabolcs Lorincz (DG Comp.) Dr. Manuel Godinho de Matos (DG Comp.) Professor Jan Brueckner (U. California, Irvine) Dr. Benoit Durand (RBB)

5 Merger: Yellow Netherlands Chair: Professor Maarten Pieter Schinkel
Pages Netherlands/De Telefoongids (Amsterdam) Dr. Cindy Wolfsen (NMa) Dr. Matthijs Visser (RBB) Professor Lapo Fillustricci (Tilburg)

6 Article 102: Qualcomm and Rambus EU Chair: Professor Massimo Motta (Barcelona) Dr. Mario Mariniello (DG Comp) Professor Gerard Llobet (Cemfi and LECG Professor Patrick Rey (Toulouse)

7 Topic: Kraft/Cadbury and the Role of Econometrics in Competition Policy EU Chair: Professor Mark Ivaldi (Toulouse) Dr. Hugh Wills, CRA Dr. Alejandro Requejo (LECG) Professor Howard Smith (Oxford)

8 Market Inquiry: UK Groceries Market and The Competition Test UK Chair: Professor Lars Sørgard (NSE) Dr. David Parker (Frontier) Professor Greg Crawford (Warwick) Dr. Nicola Mazzaroto (CC)

9 Article 102: Interchange fees – “Bank case” France Chair: Professor Bruno Julien (Toulouse) Dr. Cédric Nouel de Buzonnière (Autorite de la Concurrence) Speaker (academic, tbd) Dr. David Sevy (LECG)

10 Article 101: Spanish sugar cartel Spain Chair: Professor Kai Uwe Kuhn (Michigan) Dr. Francisco Jimenez (NERA) Dr. Nadine Watson (LECG) Professor Frank Verboven (Leuven)

11 State Aid: In Banking Roundtable (including Lloyds/HBOS divestitures.) EU Chair: tbd Dr. Stan Maes (DG Comp.) Professor Bruce Lyons (UEA) Dr. Helen Jenkins (Oxera) Dr. Lorenzo Coppi (CRA)

12 Best Academic Paper All To be determined! Vote now!

Please note that most sessions will run in parallel in sets of three.

October 4, 2010 | Permalink | Comments (0) | TrackBack (0)

Do Incumbents Improve Service Quality in Response to Entry? Evidence from Airlines' On-Time Performance

Posted by D. Daniel Sokol

Jeffrey Prince, Indiana University - Kelley School of Business and Daniel H. Simon, Cornell University - Department of Applied Economics and Management ask Do Incumbents Improve Service Quality in Response to Entry? Evidence from Airlines' On-Time Performance.

ABSTRACT: We examine if and how incumbent firms respond to entry, and entry threats, using non-price modes of competition. Our analysis focuses on service quality within the airline industry. We find that incumbent on-time performance actually worsens in response to entry, and even entry threats, by Southwest Airlines. Given Southwest’s general superiority in on-time performance, this result is consistent with equilibria of theoretical models of quality and price competition, which generally predict differentiation along quality. We corroborate this intuition with further analysis, showing there is no notable response by incumbents when an airline with average on-time performance (Continental) threatens to enter or enters a route.

October 4, 2010 | Permalink | Comments (0) | TrackBack (0)

Sunday, October 3, 2010

WIPO Symposium on Intellectual Property and Competition Policy - Enforcing Antitrust Law with Reference to Intellectual Property Assets: New Developments and Perspectives

Posted by D. Daniel Sokol


Symposium on Intellectual Property and Competition Policy Enforcing Antitrust Law with Reference to Intellectual Property Assets: New Developments and Perspectives

Geneva, October 25, 2010

In the context of the implementation of the WIPO Project on Intellectual Property and Competition Policy, which was approved by the Committee on Development and Intellectual Property (CDIP) at its third session (in November 2009), the WIPO Secretariat will organize a Symposium in which participants will have the opportunity to scrutinize current developments in the enforcement of antitrust law as far as IP protected intangible assets are affected.  This objective is expressed in the proposed Symposium’s title, which is “Enforcing Antitrust Law with reference to Intellectual Property Assets:  New Developments and Perspectives.”  Bearing this in mind, the WIPO Secretariat has invited four national antitrust authorities and four private companies that have acquired practical experience in antitrust enforcement initiatives with an impact on the protection and effective use of IP.  As the draft program indicates, the Federal Trade Commission (of the United States), the European Commission, the Brazilian CADE (Administrative Council of Economic Defense) and the Chinese Anti-Monopoly Bureau, have been invited to speak in the morning session.  In the afternoon, four large companies (two from the United States, Microsoft and Qualcomm, and two from Europe, Boehringer and Philips) will have the opportunity to express their views and concerns about recent trends in the antitrust analysis of the use of IP assets. 

It is expected that, at the end of each session, speakers and participants will engage in a lively and constructive debate, with the aim of better understanding the complex interface between intellectual property and antitrust law.

The Symposium is primarily aimed at Geneva-based diplomats and community. It is open to the general public and free of charge. Anyone interested in attending the Symposium is requested to complete the on-line registration form.

This meeting is the second in a series of four Symposia, which, as announced previously, will gradually be more thematically focused. In the course of 2011, WIPO will hold two additional Symposia aimed at discussing the findings of two of the studies that constitute one of the eight Project components.

October 3, 2010 | Permalink | Comments (0) | TrackBack (0)