Brander and Lewis argue in a seminal paper (AER, 1986) that a firm's debt-equity ratio should have important strategic effects on product market competition. We test their model in a duopoly experiment under both, Bertrand and Cournot competition. We find that leverage has strategic effects, but...

This paper discusses the properties of stylized U.S. (U-type) and Japanese tournaments (J-type), which can both solve the unverifiability problem of labor contracts. Under a zero-profit condition, both tournament types will yield first-best efforts if workers are homogenous and risk neutral....

In an asymmetric tournament model with endogenous risk choice by the agents it is shown that equilibrium efforts decrease (increase) with risk if abilities are sufficiently similar (different). Risk also affects winning probabilities. The interaction of both effects is analyzed.

The paper shows that interjurisdictional competition for mobile factors of production forces the government to raise the efficiency of the public sector and, thus, helps to tame Leviathan governments. However, this result is derived under some restrictive assumptions concerning the kind of tax...

Obwohl die Kompetenz zur Ausgestaltung ihrer sozialen Sicherungssysteme nach wie vor bei den Mitgliedstaaten der europäischen Union liegt, wendet der Europäische Gerichtshof seiner bisherigen Tradition folgend das europäische Gemeinschaftsrecht zunehmend auch auf die wirtschaftliche Seite...

Plans for the development of high speed railways lines (HSR) in Spain are widespread. At the beginning of 2010 four HSR lines were operating in routes where the air transport mode used to be dominant. In this paper we examine through econometric means the air carriers' reaction to these HSR...