We examine aspects of how new technology may be transferred to firms that use it in a final product market. Should technology transfer take place to a single firm or to more than one, and should it happen gradually or at once? How do the incompleteness of contracts and the nature of product...

In this chapter, we review some recent work on public intervention in economic environments where firms undertake investments in research or in physical assets, and then select appropriate business practices to extract profits from the outcomes of the investment process. Public policies may take...

We study the impact of legal principles on the design and the effectiveness of antitrust fines. Modern antitrust enforcement obeys four basic legal principles: punishments should fit the crime, proportionality, bankruptcy considerations, and minimum fines. We integrate these principles into a...

Public policy makers around the world are concerned with the cost and quality of healthcare. I argue that competition-policy economics can make valuable contributions to solving the healthcare crisis by addressing four fundamental questions:Why don't insurance companies offer policies that...

We develop a parametric model in which a high-quality dominant firm faces a low-quality competitive fringe. We show that in this model, an increase in the dominant firm's product quality increases total welfare and consumer surplus. An increase in fringe firm quality has an ambiguous effect on...

We consider the interaction between an incumbent firm and a potential entrant, and examine how this interaction is affected by demand fluctuations. Our model gives rise to procyclical entry, prices, and price-cost margins, although the average price in the market can be countercyclical if the...

By defining three targets as pillars of their environmental policy (20% cleaning, 20% greening, and 20% saving energy by 2020), European authorities are putting out noisy signals on what the actual objective is and how to achieve it. I show that, whereas the community-wide CO2 market (named...

Quantity discounts of all kinds — be it pure quantity discounts, bundled discounts, or market-share discounts — have raised considerable antitrust concerns. Unlike its U.S. counterpart, the European Commission (EC) has adopted a fairly tough stance on such business practices, to...

This study investigates when a cartel that uses a sales quota allocation scheme monitors more frequently than it enforces; for example, monitoring of sales is done on a weekly basis but firms are only required to comply with sales quotas on a quarterly basis. In a simple three-period quantity...

Recent laboratory experiments support the popular view that the introduction of corporate leniency programs has significantly decreased cartel activity. We develop a classroom experiment that captures key features of leniency programs. Our treatments include an exploitable and a non-exploitable...