The financial crisis has been attributed partly to perverse incentives for traders at banks and has led policy makers to propose regulation of banks' remuneration packages. We explain why poor incentives for traders cannot be fully resolved by only regulating the bank's top executives, and why...

This paper provides an analysis of exclusive contracts between health care providers and insurers in a model where some consumers choose to stay uninsured. In case of a monopoly insurer, exclusion of a provider changes the distribution of consumers who choose not to insure. Although the...

A renewable obligation combined with tradable renewable energy certificates is a market-based instrument used to promote the production of electricity from renewable energy sources. A renewable obligation is an alternative for subsidies. A renewable obligation will only be an efficient...

We analyze long-run scenarios for the European natural gas markets in a model, NATGAS, that explicitly includes both resource constraints and producers’ market power. Europa wordt geconfronteerd met afnemende eigen aardgasvoorraden, met name in de van oudsher grote producenten het Verenigd...

In this study, we analyse changes in market power in the Dutch supermarket chain and discuss the effects on welfare. The supermarket chain includes consumers, supermarkets, buyer groups and food manufactures. We look at the theoretical background of market power.  Special attention has been...

We analyse downstream access and capacity choice in the market for wireless telecommunications, where spectrum rights are owned by vertically integrated duopolists and may be traded. In the market for wireless telecommunications, radio spectrum is an essential input. Prior to network...

In this paper, the authors study optimal risk adjustment in imperfectly competitive health insurance markets when high-risk consumers are less likely to switch insurer than low-risk consumers.<font face="CMR10" size="3"><font face="CMR10" size="3">First, they find that insurers still have an incentive to select even if risk adjustment perfectly...</font></font>

We study how the possibility of renegotiation affects optimal bail-out policies for countries under asymmetric information on a country's cost of reforms. To that end, we solve the Bellman equation describing the optimal bail-out mechanism in a multiple-period principal-agent model with adverse...

Targeted advertising can benefit consumers through lower prices for access to websites. Yet, if consumers dislike that websites collect their personal information, their welfare may go down. We study competition for consumers between websites that can show targeted advertisements. We find that...

We study optimal timing of regulated investment in a real options setting, in which the regulated monopolist has private information on investment costs. In solving the ensuing agency problem, the regulator trades off investment timing inefficiency against the dead-weight loss arising from high...