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The Limits of Trust in Economic Transactions - Investigations of Perfect Reputation Systems

Bolton, Gary E.; Ockenfels, Axel - 2021

As the Internet economy has grown, so too has the need for trust. A degree of trust is a critical ingredient in virtually all economic relationships, Internet or otherwise. Every day we choose to trust plumbers, doctors, employers, employees, teachers, airlines, and others. The need for trust...

Persistent link: https://www.econbiz.de/10013316582

Selling Strategic Information in Digital Competitive Markets

Bounie, David - 2018

This paper investigates the strategies of a data broker in selling information to one or to two competing firms that can price-discriminate consumers. The data broker can strategically choose any segment of the consumer demand (information structure) to sell to firms that implement third-degree...

Persistent link: https://www.econbiz.de/10012914903

Horizontal Mergers and Product Quality

Brekke, Kurt R. - 2015

We study the effects of horizontal mergers when firms compete on quality and price. Two key factors are identified: (i) the magnitude of variable quality costs, and (ii) the relative magnitudes of cross-quality and cross-price effects on demand. The merging firms will increase (reduce) both...

Persistent link: https://www.econbiz.de/10013019860

Minimum Wages and Relational Contracts

Fahn, Matthias - 2016

The need to give incentives is usually absent in the literature on minimum wages. However, especially in the service … aspects regarding service quality cannot be verified, which implies that relational contracts have to be used to provide … incentives. The present article shows that in this case, a minimum wage increases implemented effort, i.e., realized service …

Persistent link: https://www.econbiz.de/10012985792

Hospital Competition and Quality with Regulated Prices

Brekke, Kurt R. - 2010

We analyse the effect of competition on quality in hospital markets with regulated prices, considering both the effect of (i) introducing competition (monopoly versus competition) and (ii) increasing competition through lower transportation costs (increased substitutability) or a higher number...

Persistent link: https://www.econbiz.de/10013152862

Measuring Strategic Firm Interaction in Product-Quality Choices : The Case of Airline Flight Frequency

Brueckner, Jan K. - 2013

This paper investigates strategic interaction among airlines in product-quality choices. Using an instrumental variables approach, the paper estimates flight-frequency reaction functions, which relate an airline's frequency on a route to its own characteristics and to the frequencies of...

Persistent link: https://www.econbiz.de/10013088139

Can Competition Reduce Quality?

Brekke, Kurt R. - 2014

In a spatial competition setting there is usually a non-negative relationship between competition and quality. In this paper we offer a novel mechanism whereby competition leads to lower quality. This mechanism relies on two key assumptions, namely that the providers are motivated and...

Persistent link: https://www.econbiz.de/10013057658

Patient Mobility, Health Care Quality and Welfare

Brekke, Kurt R.; Levaggi, Rosella; Siciliani, Luigi; … - 2021

Patient mobility is a key issue in the EU who recently passed a new law on patients’ right to EU-wide provider choice. In this paper we use a Hotelling model with two regions that differ in technology to study the impact of patient mobility on health care quality, health care financing and...

Persistent link: https://www.econbiz.de/10013315635

Intergenerational Transmission of Skills During Childhood and Optimal Public Policy

Casarico, Alessandra; Micheletto, Luca; Sommacal, Alessandro - 2021

The paper characterizes the optimal tax policy and the optimal quality of day care services in a OLG model with warm-glow altruism where parental choices over child care arrangements affect the probability that the child becomes a high-skilled adult in a type-specific way. With respect to...

Persistent link: https://www.econbiz.de/10013316071

A Note on Brain Gain and Brain Drain : Permanent Migration and Education Policy

Haupt, Alexander; Krieger, Tim; Lange, Thomas - 2021

In this note, we present a novel channel for a brain gain. Students from a developing country study in a developed host country. A higher permanent migration probability of these students appears to be a brain drain for the developing country in the first place. However, it induces the host...

Persistent link: https://www.econbiz.de/10013316173