In this Policy Paper, we analyze the effects of quot;network neutralityquot; proposals that seek to mandate an inflexible set of rules that would foreclose or severely limit many market transactions. Our model reveals that under plausible conditions, rules that prohibit efficient commercial...

In recent years, several competition authorities around the world have announced majorinvestigations into potential anti-competitive behaviour by digital platforms. Not all ofthat behaviour harms downstream consumers. This has contributed to a growing ‘existentialcrisis’ at the foundation of...

We show how frictions and continuous transfers jointly affect equilibria in a model of matching in trading networks. Our model incorporates distortionary frictions such as transaction taxes, bargaining costs, and incomplete markets. When contracts are fully substitutable for firms, competitive...

Early economic research on natural monopoly regulation focused on market failure -- pricing tariffs and externalities. While Coase's multi-tariff marginal cost pricing became the standard, his approach to externality regulation as a contractual issue shifted the debate to transaction costs, but...

By introducing the concept of "social asset specificity," this paper presents an attempt to analyze public institutions and macro-level institutional change. Social asset is defined as the aggregate of all physical asset, human asset, political, social and legal rules, and so on, that are...

When more than one component or activity is needed to produce the final product, a firm may use proprietary standards or adopt a common standard to integrate these components. We call these closed and open firms respectively, and develop a model of industry evolution to study the process by...

Reputation-based trust, reflecting the time-dependency of trust, influences inter-firm alliances. A literature review resulted in hypotheses which were tested in an empirical study based on a quantitative analysis and in-depth interviews with firms in the bio tech sector of human health in the...

Asset specificity is usually considered to be an argument for vertical integration. The main idea is that specificity induces opportunistic behavior, and that vertical integration reduces the cost of preventing opportunism. In this article I show that asset specificity can be an argument for...