The first chapter considers a common agency model where two competition authorities share information about a firm under investigation. It shows that information-sharing can sometimes be welfare detrimental unless the authorities coordinate their enforcement policies as well as share information. The reason behind is that the authorities may have different leniency levels and the firm may decide to provide less precise information to one in an attempt to appeal the other. Furthermore it shows that the authorities may want to distort their policies in order to prevent the firm from obscuring the information it provides. The second chapter studies the seller's incentives to provide misleading advice about complex goods such as consumer electronics, banking or phone services. It shows how the incentives to give biased and imprecise advice are affected by the possibility of ex-post litigation, when a court or consumer protection authority investigates how biased the advice is and penalises accordingly. It finds that a more biased advice will also be less precise, thus, a stricter punishment for deceiving consumers also increases precision. The third chapter analyses the impact of trade credit on a relational contract between two vertically related firms. The firms operate in an environment with unobservable shocks, like a developing country or a black market, which create moral hazard in the repayment decision. It shows that the quantity sold in the market will be distorted downwards in order to curb the constrained firm's incentives to steal the credit and derives the optimal repayment scheme.

In many procurement auctions, entrants determine whether to participate in auctions accounting for their roles of intermediaries who search for the best (or the cheapest) input suppliers. We build on a procurement auction model with entry, combining with intermediary search for suppliers. The novel feature is that costs of bidders are endogenously determined by suppliers who strategically charge input prices. We show the existence of an equilibrium with price dispersion for inputs, generating cost heterogeneity among bidders. Interestingly, the procurement cost may rise as the number of potential bidders increases. (author's abstract) / Series: Department of Economics Working Paper Series

Diese Dissertation diskutiert zwei Modellvarianten der Spieltheorie und Industrieökonomik: asymmetrische Information und vertikale Beziehungen. In einem Reputations-Spiel, in welchem Kurzfristspieler hintereinander entscheiden, ob sie mit einem Langfristspieler interagieren wollen, stoppt die Interaktion oft für immer, sobald einer der Spieler sich entscheidet nicht zu interagieren. Ist der Aktionsraum des Langfristspielers ausreichend groß, kann es passieren, dass obwohl die Einschätzungen über die Reputation des Langfristspielers identisch sind, das Verhalten sich verändert, da der vorhergehende Stopp der Interaktion den Langfristspieler dazu bringt, sich mehr anzustrengen. In einer vertikalen Struktur, in welcher Intermediäre ein Input-Gut von einer exogenen Anzahl an Zulieferern beziehen müssen, können diese Intermediäre die Menge eines homogenen Produkts, welches an Konsumenten verkauft werden soll, wählen. Falls einer der Intermediäre in Form einer Genossenschaft organisiert ist, steigt der durchschnittliche Gewinn der Zulieferer, was zu einem ineffizient geringen Angebot an die Konsumenten führt. Eine Kooperative kann sich als Monopol behaupten, sofern die Kapazität der Zulieferer ausreichend gering ist, während eine Duopolstruktur vorliegt, wenn diese Kapazität hoch ist. In einer Wertschöpfungskette mit einem Zulieferer, einem Händler und Unsicherheit über die Nachfrage am Markt sind die Entscheidungen über kostenlose Informationsbeschaffung, um diese Unsicherheit aufzulösen, strategische Komplemente. Wenn die technische Beschränkung der Signalpräzision so ist, dass die Informationsbeschaffung nicht genug Unsicherheit beseitigt, ist die Informationsrente klein und der Zulieferer kann sich entscheiden uninformiert zu bleiben, um ein Glaubwürdigkeitsproblem zu umgehen und Verträge anzubieten die keine private Information signalisieren. Steigt die Signalpräzision, entscheiden sich beide Marktteilnehmer so gut wie möglich informiert zu sein. / This dissertation discusses two modelling variants in game theory and industrial economics: asymmetric information and vertical relations. In a reputation game, in which a sequence of short-run players chooses if to interact with a long-run player, often interactions stops forever, if one short-run player decides not to interact. If the long-run player''s action set is sufficiently rich, although beliefs about the long-run player''s reputation may be identical, choices may be different, as the preceding refusal to interact can lead the long-run player to improve on effort. In a vertical structure, in which intermediaries have to acquire an input from an exogenously given number of suppliers, intermediaries can choose the quantities of a homogenous product to be sold to consumers. In case one of the intermediaries is organized as a cooperative the average profit of suppliers, increases, leading to inefficiently low supply to consumers. Furthermore, a cooperative may be a monopoly in the downstream market, if the upstream production capacity is sufficiently small, whereas there is a duopoly with one firm maximizing its profit and one firm maximizing average profit, if upstream capacity is large. In a supply chain with one supplier, one retailer and uncertainty about market demand, the choices on costless information acquisition to resolve this uncertainty are strategic complements. If the technical limitation on the precision of the signals is such that being informed does not reduce enough uncertainty, the potential information rent is small and the supplier may choose to stay uninformed and avoid a credibility problem by offering pooling contracts. If the precision of private signals increases, both agents decide to be informed as much as possible.

A recent highly disputed subject of regulating energy markets in Europe is the unbundling of vertically integrated down- and upstream firms. While legal unbundling is already implemented in most countries and indisputable in its necessity for approaching regulatory aims, continuative models as ownership unbundling or the alternative of an independent system operator are still ambiguous. Hence, this article contributes to the economic analyses of identifying the differences of separate types of unbundling. Via simulation, we find that legal unbundling brings about the lowest prices in a market under Cournot competition. Moreover, under Bertrand competition, no differences between legal unbundling and ownership unbundling can be identified. (author's abstract) / Series: Working Papers / Research Institute for Regulatory Economics

This dissertation contributes to the literature and current discussions on the European postal markets and the universal service obligations (USO). It consists of three independent chapters.<p><p>In chapter one, we investigate the consumers' preferences for various kinds of postal services. As such, we begin by reviewing the market and regulatory conditions for Europe and for our case study, Belgium. Then using data provided by the incumbent provider, the Belgian post (Bpost), we estimate demand price elasticities. The data comprises customer transactional information on letter mail, direct mail, parcels & express services, press delivery and value added services for the 2008-2009 period. These categories constitute not only the important lines of services that Bpost offers to its clients but also the main segments that constitute the whole Belgian postal market. As such, and using standard methods, we estimate for each service an equation that explains demand by prices, product varieties (i.e. mixes or combinations of volume, weight, priority and destination, inter alia), income, regulation proxies and other socioeconomic variables. The estimated price elasticities for regulated and partially regulated services are around -1.1, whereas for unregulated segments they fluctuate between -2.1 and -2.8. The lowest price elasticity is obtained for direct mail services (-1.0); the highest ones are associated with value added services (-2.1) and registered mail (-3.3). Price elasticities may be influenced by the cyclical effects during the period of analysis. Therefore, elasticities are higher when compared with the empirical evidence obtained for other countries and through the various methodologies applied over the last decades. The fact that technological substitutes, such as expenditures on telephony and internet access for daily and administrative mail services and, radio and television advertising for direct mail services, could not be accounted for (because there were no data available) may however be considered as a major limitation for the scope of our results. <p><p>In the second chapter, we explore theoretically the effects of the USO on unregulated markets. In particular, we are interested in investigating its welfare effects when the provision of services cannot be technologically separated. We present a model in which there is an incumbent who provides two services: a universal service and a non-USO service, the latter opened to competition. This is the case of letter mail and direct (or bulk) mail, services which have quite different purposes and regulatory frameworks (i.e. the former is fully regulated whereas the latter is liberalized under the current European Internal Market framework), but are jointly produce at some stages of the postal value chain. The USO is simplified to two dimensions, affordability and quality, implemented as a price cap and a minimum quality standard (MQS) for the provision of letter mail services. The latter involves the technological aspects that we are interested in. We find that the definition of the USO plays an important role in organizing markets that are open to competition. When it imposes few quality requirements (low MQS), the incumbent is not cost efficient enough to provide the high-quality variant of bulk mail, allowing its competitors to cream-skim the segment. However, because there are cost economies, the firm's participation in the segment yields a higher average quality of mail services at lower prices. When the USO is too comprehensive (high MQS), the incumbent exhibits large cost economies that ensure a dominant position in the provision of bulk mail services. Consumers are worse off as competition induces too much service differentiation in order to make profitable the provision. Relaxing the definition of the USO mitigates the competitive advantage of the USP and so, yields improvements in welfare. In the absence of access costs, firms will find profitable to participate in the bulk mail segment. However, foreclosure happens if the USO induces the incumbent to exhibit significant fixed costs. Therefore, the USP may end up as the sole supplier of bulk mail services if the definition of the USO imposes too many quality requirements (high MQS). In that case, the authority must balance the welfare gains of defining USO with the welfare losses of the consumers of the contested service. <p><p>Finally, in the third chapter we consider the ownership aspect of the provision of universal services as an incentive to introduce competition. One can further segment the provision between services for customers located in high-cost areas and services for customers located in low-cost areas. Additionally, under the current EU legislation, the supply is divided between upstream activities (e.g. collection and sorting) and downstream activities (i.e. delivery). The provision of upstream activities in high-cost areas remains in hands of the incumbent firm or the owner of the downstream (delivery) network. The upstream provision in low-cost areas is open to competition, but a retailer may be vertically integrated/separated or legally unbundled with the downstream firm. Legal unbundling means, in our model, that the downstream firm and one upstream firm located in the low-cost area belong legally to the same entity entitled to all profits, whom does not have full control rights over the firms' decisions. That is to say, upstream activities and the downstream services will be managed separately under the same ownership. In this framework we analyze the firm's boundaries in terms of competition development and welfare. We implement two criteria to answer questions like, does vertical separation promotes competition (entry of firms) while covers a larger demand than vertical integration? Does vertical integration demand less public funds to cover demand? Does legal unbundling is worse than ownership separation to promote competition? The first criterion is the probability of entry (of the potential upstream firm), which we determine for each modes of ownership. The second criterion is the cost of public funds. It is implemented by defining a loss function as the difference between the expected consumer surplus when the downstream firm chooses an access fee that maximizes its profits and the consumer surplus when access is priced at marginal cost. The use of both criteria let us conclude that efficient entry occurs when the downstream firm is vertically separated or legally unbundled of the retailer providing services in the low-cost area. However, it is under legal unbundling that the access charge takes its lowest value. The highest cost of public transfers is obtained when firms are vertically separated, but the lowest one is attained when firms are legally unbundled. Therefore legal unbundling constitutes the preferred organizational form to induce competition and to reduce the cost of public funds. / Doctorat en Sciences économiques et de gestion / info:eu-repo/semantics/nonPublished