Xerox invented modern copier technology and was so successful that its brand name became a verb. In 1972, U.S. antitrust authorities charged Xerox with monopolization and eventually ordered the licensing of all its copier-related patents. As new research by Robin Mamrak shows, this antitrust intervention promoted subsequent innovation in the copier industry, but only among Japanese competitors. Nevertheless, their innovations benefited U.S. consumers.
In new research, Cyril Hédoin and Alexandre Chirat use the rational-choice theory of economist Anthony Downs to explain how populism rationally arises to challenge established institutions of liberal democracy.
In a new paper, Bing Guo, Dennis C. Hutschenreiter, David Pérez-Castrillo, and Anna Toldrà-Simats study how large institutional investors impact firm innovation. The authors find that large institutional investors encourage internal research and development but discourage firm acquisitions that would add patents and knowledge to their firms’ portfolios, hampering overall innovation.
Simcha Barkai describes the results of new research on the impact of antitrust on U.S. economic activity with co-authors Tania Babina, Jessica Jeffers, Ezra Karger, and Ekaterina Volkova. Enforcement, they find, increases the level of economic activity.
In new research, Mariana Pargendler, Maria Luiza Mesquita, and Lucas Víspico study how antitrust authorities in the Global South have used family ties to define business enterprises and analyze mergers and acquisitions for possibly anticompetitive behavior.
In new research, Francesco Barilari and Diego Zambiasi study how President Ronald Reagan and George H.W. Bush’s rhetoric on the War on Drugs while on the campaign trail, particularly targeting crack cocaine abuse, was enough to alter policing policy. Specifically, the authors find that increased rhetoric led to an increase in arrests of Black Americans. Their study contributes to a literature on the material impact that political rhetoric can have on policing and public policy.
With slightly more than one year until the United States presidential election, electoral campaigns are about to ramp up. These quadrennial elections, like so many others in democracies worldwide, will mobilize thousands of campaign workers who play an integral role in shaping candidates’ electoral performance. Yet, little is known about these workers and how the experience of working in a campaign shapes their professional lives. This column describes the findings from a new study on the career trajectories of campaign labor in Brazil, showing that connections forged on a campaign provide qualified workers with better employment and earnings opportunities. This article was originally published in VoxEU.
In new research, Sabien Dobbelaere, Grace McCormack, Daniel Prinz, and Sándor Sóvágó find that mergers negatively impact labor market outcomes. Mergers result in job losses, and the earnings of workers who lose their jobs don’t recover for several years on average. The authors find these negative consequences are more likely attributable to the restructuring of labor forces than subsequent firm market power.
Do labor markets in Europe or the United States and Canada experience more monopsony power? In a new paper published in the University of Chicago Law Review, Satoshi Araki, Andrea Bassanini, Andrew Green, Luca Marcolin, and Cristina Volpin provide comparisons of monopsony power between the two regions, documenting similar levels of concentration across labor markets despite generally stronger protections in Europe. They also discuss the effects of such concentration on employment and wages, ending with potential regulatory reforms to address these issues.
Economists have become increasingly interested in questions about populism over the last decade and particularly since Brexit and the election of American President Donald Trump. However, the definition of populism remains contested. Alan de Bromhead and Kevin O’Rourke argue that economists need a better understanding of populism’s history and its variegated goals when ascribing specific characteristics and behaviors to populists and their movements.
Much of the conversation of the proposed Kroger-Albertsons merger has focused on the risks to consumers. However, the merger also poses serious implications for the grocers’ upstream suppliers, particularly smaller regional firms.
Due to a change in how the FDIC resolves failed banks, uninsured deposits have become de facto insured. Not only is this dangerous for risk in the banking system, it is not what Congress intends the FDIC to do, writes Michael Ohlrogge.
Former special assistant to the president for technology and competition policy Tim Wu responds to the November 27 letter signed by former chief economists at the Federal Trade Commission and Justice Department Antitrust Division calling for a separation of the legal and economic analysis in the draft Merger Guidelines.
In new research, Valentino Larcinese and Alberto Parmigiani find that the 1986 Reagan tax cuts led to greater campaign spending from wealthy individuals, who benefited the most from this policy. The authors argue that a very permissive system of political finance, combined with the erosion of tax progressivity, created the conditions for the mutual reinforcement of economic and political disparities. The result was an inequality spiral hardly compatible with democratic ideals.
Many financial commentators thought that the surge of retail investors participating in the stock market, the most notable of whom boosted “meme stocks” like GameStop, would democratize corporate governance and improve prosocial firm behavior, including the promotion of environmental, social, and governance (ESG) goals. In new research, Dhruv Aggarwal, Albert H. Choi, and Yoon-Ho Alex Lee find evidence that the exact opposite took place.
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