David Encaoua

Degree of Monopoly, Indices of Concentration and Threat of Entry

Degree of Monopoly, Indices of Concentration and Threat of Entry Author(s): David Encaoua and Alexis Jacquemin Source: International Economic Review, Vol. 21, No. 1 (Feb., 1980), pp. 87-105 Published by: Wiley for the Economics Department of the University of Pennsylvania and Institute of Social and Economic Research -Osaka University Stable URL: http://www.jstor.org/stable/2526242 . Accessed: 09/11/2014 05:57

The Economics and Econometrics of Innovation

Overview. Part I: The Macroeconomic Effects of Innovation. 1. On the Macroeconomic Effect of Major Technological Change P. Aghion, P. Howitt. 2. On Knowledge Diffusion, Patents Lifetime and Innovation Based Endogenous Growth P. Michel, J. Nyssen. 3. Endogenous Growth and the Labor Market F. Cerisier, F. Postel-Vinay. Part II: Publicly Funded Science. 4. Research Productivity in a System of Universities J.D. Adams, Z. Griliches. 5. Reputation and Competence in Publicly Funded Science: Estimating the Effects on Research Group Productivity A. Arora, et al. 6. The Impact and Organization of Publicly Funded Research and Development in the European Community M.P. Feldman, F.R. Lichtenberg. 7. An Auction Model of Intellectual Property Protection: Patent Versus Copyright M. Waterson, N. Ireland. 8. Information Disclosure and the Renewal of Patents C. Crampes, C. Langinier. 9. Appropriation Strategy and the Motivations to Use the Patent Systems: An Econometric Analysis at the Firm Level E. Duguet, I. Kabla. 10. Patents and R&D, An Econometric Investigation Using Applications for German, European and US Patents by German Companies G. Licht, K. Zoz. Part III: Network Goods and Standardization. 11. Equilibrium Coalition Structures in Markets for Network Goods N. Economides, F. Flyer. 12. Does Standardization Really Increase Production? H. Stahn. Part IV: Investment and Productivity in R&D. 13. Accumulation of R&D Capital and Dynamic Firm Performance: A Not-So-Fixed Effect Model T.J. Klette, F. Johansen. 14. Are there Financing Constraints for R&D and Investment in German Manufacturing Firm? D. Harhoff. Part V: Profits from Innovation. 15. The Commercial Success of Innovations: An Econometric Analysis at the Firm Level in French Manufacturing C. Barlet, et al. 16. Incentives for Cost Reducing Innovations under Quantitative Import Restraints C.C. Cabral, et al. 17. The Size Distribution of Profits from Innovation F.M. Scherer. Part VI: Spillovers. 18. Looking for International Knowledge Spillovers: A Review of the Literature with Suggestions for New Approaches L. Branstetter. 19. Factor Intensities, Rates of Return, and International R&D Spillovers: The Case of Canadian and U.S. Industries J. Bernstein. 20. Exploring the Spillover Impact on Productivity of World-Wide Manufacturing Firms H. Capron, M. Cincera. 21. Innovation Spillovers and Technology Policy Y. Katsoulacos. Index of Names. Index of Subjects.

Organizational Efficiency and Monopoly Power - the Case of French Industrial Groups

Abstract In this paper, we examine the respective roles of efficiency and of market power considerations in explaining why industrial groups are the predominant form of organization in specific industries. Our econometric analysis of French industrial groups suggests that administrative and organizational efficiency is an adequate explanation for the existence of these groups and that rivalry between groups differently integrated and diversified is more likely to be the case than collusion.

THE COMMERCIAL SUCCESS OF INNOVATIONS : AN ECONOMETRIC ANALYSIS AT THE FIRM LEVEL IN FRENCH MANUFACTURING

This paper offers some empirical evidence on how do product and process innovations affect manufacturing sales and exports. Accounting for differences in technological opportunities between industries, and the “market pull” or “technology push” nature of firms’ innovations, we explain the share of new products in total sales and exports by the innovation types firms have implemented. The data come from the French Ministry of Industry’s Innovation survey 1986–1990. The left-hand variables are the sales revenues and the export revenues of the firms that are attributable to products introduced within the last 5 years. Given that the survey reports only interval data, our estimates were obtained by maximum likelihood on the ordered probit model. The following results are obtained: (i) The contribution of products less than 5 years old is lower to overall exports than to total sales but the innovative content is stronger in exports than in domestic sales; (ii) The greater the underlying technological opportunities, the less successful are product imitations; (iii) Both domestic sales and exports are mostly made of product improvements; (iv) Firm size has a positive effect on innovation output only when the technological opportunity is strong.

Liberalizing European airlines : Cost and factor productivity evidence

Abstract European countries do not all share the same view concerning the benefits of increased competition among airlines in Europe. To explain this difference in attitudes, the paper presents evidence on differences in costs and global factor productivity between the main European national flag carriers. The data reveal a clear distinction between the main European and North Atlantic routes. Unit costs per passenger-kilometer are lower in North Atlantic routes and unit profits are higher in European routes. The first result reflects the economies of scale due to higher distances and traffic density on North Atlantic routes. The second result is an indication of the lower level of competition between airlines in Europe. Finally, Tornqvist factor productivity growth indexes (1981–1986) show that the initial gap which existed between these productivity measures at the beginning of the period is shrinking. This suggests that the European airline industry is currently in a more favorable situation to support more competition.

COMPATIBILITY AND COMPETITION IN AIRLINES -- DEMAND SIDE NETWORK EFFECTS /

Abstract Network effects arising in air transport markets are usually viewed as resulting from the implications of joint production on the cost side. In this paper, we focus on network effects originating on the demand side. We consider a network that links three cities involving two direct and one indirect connection. Two carriers, with asymmetric traffic rights on this network compete sequentially: at the first stage, they choose their departure times; at the second, they set prices. We show that in order to compensate its network disadvantage the ‘weak’ carrier chooses its departure time as close as possible to its competitors. This is in contrast to the usual maximum differentiation principle. The network effect intensifies price competition. Depending on the size of the market and on consumers valuation of waiting time, various subgame perfect equilibrium configurations are exhibited.

Strategic Competition and the Persistence of Dominant Firms: a Survey

In the struggle to create, maintain and expand favourable market positions, firms’ actions are intended not only to affect the current conduct of rivals directly, but also to have an indirect effect by altering market structure in a way which constrains the rival’s subsequent actions. In this dynamic process, market strategies or conduct (the control variables) interact with market structure (the state variable); and current conduct can become embedded in future market structure through strategic investments made by firms to bar entry and reduce intra-industry mobility. (For an analysis of this view of industry dynamics, see Jacquemin, 1972; Caves, 1976, Part I; Caves and Porter, 1977; Spence 1981a, p. 51; and Stiglitz, 1981, p. 187). Of course, not all investments made by firms have the intended effect on market structure, and the purpose of this survey is to consider a recent body of literature which has devoted itself to precisely this point.1 This work is of interest because of the new light it has shed on the combined structural and strategic origin of market power; that is, on the hoary question of the persistence and profitability of dominant firms (compare Posner, 1972, p. 130 with Williamson, 1975, p. 218 for contributions to this old debate). The literature seems to have coalesced around two basic types of model.

Competition, cooperation and mergers: Economic and policy issues

Abstract This paper contrasts two types of European Community competition policies with respect to joint ventures, namely concentrative joint ventures (CCJV), which fall under the Merger Control Regulation and cooperative joint ventures (CPJV), which fall under Article 85(1). The contrast occurs at different levels: procedural, jurisdictional and substantive. It provides firms with bargains and trade-off opportunities for the choice of the more convenient jurisdiction for their transactions. The paper presents a model illustrating how these bargains and trade-offs can operate in the context of an endogenous choice between a CCJV and a CPJV.

Optimal licensing of uncertain patents in the shadow of litigation

This paper investigates the choice of a licensing mechanism by the holder of a patent whose validity is uncertain. We provide sufficient conditions of a general nature under which the licensor prefers to use a per-unit royalty contract. In particular we show that this is the case for the holders of weak patents if the strategic effect of an increase in a potential licensees unit cost on the equilibrium industry profit is positive. The latter condition is shown to hold in a Cournot (resp. Bertrand) oligopoly with homogeneous (resp. differentiated) products under general assumptions on the demands faced by firms. As a byproduct of our analysis, we contribute to the literature on the cost paradox in oligopoly by offering some new insights of independent interest regarding the effects of cost variations on Cournot and Bertrand equilibria.

Différenciation des produits et structures de marché: un tour d'horizon

This paper is a survey of some recent theoretical models related to the endogeneous determination of market structure in differentiated products industries. Usually, market structure is explained mainly by supply side characteristics such as economies of scale, economies of scope and sunk costs. These variables remain however exogeneous, which is incompatible with long term competition. Here, this view is contrasted with the one which emphasizes three aspects: the nature of product differentiation, the process of entry and choice of product, and the competition for sequential innovations.