Role Of Economic Analysis Research Articles

Unresolved Questions Regarding Lawyers’ Fees and the Restriction of Competition

This paper explores the most salient aspects of the case-law of the Court of Justice of the European Union on legal services in order to highlight a lack of clarity in defining the terms of compatibility between European Union law and national rules on lawyers’ fees. This is a complex issue and one that has not yet been finally resolved, especially in a difficult context such as that of the Italian market, which is characterised by an extremely large number of lawyers, which in itself entails the risk of deterioration in the quality of services provided, with services being offered at a discount. In Italy, following the Cipolla judgment of the ECJ and the resulting abolition of the system of fixed remuneration (minimum and maximum fees), new measures were introduced by the State and professional organisations to protect members of the legal profession (particularly to safeguard lawyers in a weaker position in dealings with powerful clients such as banks and insurance companies) and to ensure fair remuneration. In accordance with the Wouters exemption and the increasing role of economic analysis in competition rules, these measures require a reflective analytical approach in order to evaluate their compatibility with European Union law.

Judicial Cost-Benefit Analysis Meets Economics: Evidence from State Unfair and Deceptive Practices Laws

Section 5 of the Federal Trade Act (FTC Act) prohibits or deceptive acts or practices in or affecting commerce. State statutes prohibiting unfair and deceptive acts and practices (UDAPs) often mirror Section 5 of the FTC or include harmonization provisions instructing courts to interpret and apply the state UDAP in a manner consistent with the FTC Act. It is well documented that courts applying state UDAPs have nevertheless frequently interpreted them in a manner inconsistent with the FTC Act. We highlight a different schism in unfairness analysis: the role of economic analysis. Specifically, we identify and examine differences between the application of the simple cost-benefit approach adopted by the FTC in the Unfairness Policy Statement and codified by Congress in Section 5(n) of the FTC Act, and the approach used by courts to resolve state UDAP claims. We assigned expert consumer protection economists to a Shadow Commission to evaluate a sample of state UDAP unfairness claims applying the simple FTC cost-benefit standard. Our results suggest there is little or no economic analysis at work in evaluating state UDAP claims, raise important questions about the efficacy of state UDAP unfairness enforcement, and identify a potential role for the FTC in guiding improved state UDAP enforcement.

Tacit collusion or parallel behaviour in oligopolistic markets? The two faces of Janus

ABSTRACTA fundamental step in the assessment of antitrust law cases examined by National Competition Authorities (NCAs) is to detect and penalize anti-competitive behaviour (e.g. cartel agreements, secret agreements and tacit agreements). However, this is not an easy task for NCAs since the boundaries between non-explicit (tacit) collusion and parallel behaviour in oligopolistic markets under Bertrand competition are often vague. The scope of this paper is twofold. On the one hand, it aims to cast light on the role of economic analysis in tacit collusion cases by introducing the main quantitative techniques used in antitrust policy. In this way, it contributes to the literature by highlighting the role of economic analysis blended by the use of modern econometric techniques in unveiling the tacit collusion mechanism. On the other hand, it delves into discussions of Greek competition law matters by analysing in depth a tacit collusion case from the petroleum industry.

Trump's 'Big-League' Tax Reform: Assessing the Impact and Constitutionality of the President's Proposed Changes

This paper reviews the several proposed tax reforms articulated by President Donald Trump, both during his presidential campaign, and since taking office, in light of economic theory, and the Modigliani-Miller Irrelevance Theorem, to show that companies will adapt their polices, in light of new taxes, and that this impacts the effectiveness of reform. In support, I survey two empirical studies, one in relation to the repatriation efforts of President Bush’s Homeland Investment Act, and another in relation to unexpected changes to the taxation of Canadian income trusts to show that reform measures can lead to unanticipated results. I then apply the principles from these studies, the general economic theories and the Modigliani-Miller Irrelevance Theorem, to cast uncertainty on the net effect of Trump’s tax reforms. Next, I review the constitutionality of a proposed “border adjustment tax”, and I analyze whether this reform is a direct tax that isn’t apportioned between the States, and does not qualify as income under the 16th amendment, and is thereby unconstitutional. I show that such a constitutional challenge is a difficult undertaking given the substantive arguments in favour of constitutionality, the rarity of judicial intervention in overturning tax laws, and the wide discretion of Congress to levy taxes on income. Finally, I conclude by considering the role of economic analysis on the border adjustment constitutional question and provide an overview of the arguments, both for and against utilizing economic analysis in constitutional tax litigation, including a review of the various cases, and defining principles, with emphasis to the decisions of Judge Richard Posner, where economic analysis has been used in the statutory interpretation of tax laws.

Key Aspects of Corporate Activities Analysis through the Prism of Domestic Studies

Today, the corporate sector features the considerably higher risks of corporate performance with the accordingly higher standards of accountability for results, which largely depend on objectivity, timeliness and comprehensiveness of assessment of the existing and expected financial performance of corporations. This enhances the role and significance of an important analytical field, the corporate activities analysis.
 The role of economic analysis in the context of market economy and globalization can hardly be overestimated, since the analysis permeates all the operative phases of a corporation. It precedes planning of indicators for the next period, helping organize production processes in a rational and reasonable way, improve collection and processing of information on their progress in the accounting system, assess the situation, and formulate important propositions to correct deficiencies and introduce best practices.
 Financial analysis is important in the economic operation of a corporation as it enables it to seek reserves to improve its financial condition; to assess the adequacy of use of all the types of financial resources; to take timely measures to improve the solvency, liquidity and financial stability; to ensure optimal production and social development by use of reserves found through the analysis; to develop plans for financial recovery.
 Methodology and organization of the corporate activities analysis is conditional on the organization and operation specifics of corporate enterprises. The following characteristics of a corporation are covered by analysis: economic activity; technological and organizational structure; interaction of business units within a corporation; capitalization; budgeting; integration of information system for analysis; variability in the conditions of risk.
 The review of studies devoted to corporate activities analysis shows that domestic and foreign experts offer different methods for analysis of financial statements, depending on the goals and objectives of the analysis, available information, technical support, the efficiency of solutions for analytical and management tasks, experience and qualification of staff. The corporate activities analysis will be more objective when new analysis concepts are adopted, focused on the future.

Trump's "Big-League" Tax Reform: Assessing the Impact of Corporate Tax Changes

This Article reviews and assesses corporate tax reforms advocated by President Donald Trump during his presidential campaign and signed into law since taking office (the Tax Cuts and Jobs Act of 2017), in light of economic theory and the Modigliani-Miller Irrelevance Theorem. The Article argues that companies will adapt policies in light of new taxation measures, thereby impacting the effectiveness of reform. In support of this conclusion, the Article surveys two empirical studies—one in relation to the repatriation efforts of President Bush’s Homeland Investment Act and another in relation to unexpected changes to the taxation of Canadian income trusts—to highlight how reform measures can lead to unanticipated results. The Article then applies the principles of these studies, the general economic theories, and the Modigliani-Miller Irrelevance Theorem to cast uncertainty on the net effect of Trump’s tax reforms. Next, the Article reviews the constitutionality of a “border adjustment tax.” This tax was proposed during the election campaign, but was ultimately jettisoned in the final tax reform bill. Specifically, it analyzes whether such a policy is constitutional or whether it is an unconstitutional direct tax, not apportioned between the States that does not qualify as income under the Sixteenth Amendment. The Article shows that such a constitutional challenge is a difficult undertaking given the substantive arguments in favor of constitutionality, the rarity of judicial intervention in overturning tax laws, and the wide discretion of Congress to levy taxes on income. Finally, the Article concludes by considering the role of economic analysis on constitutional challenges to tax legislation and provides an overview of the arguments, both for and against, utilizing economic analysis in this regard. The conclusion includes a review of the various cases and defining principles (emphasizing the decisions of Judge Richard Posner) where economic analysis has been used in the statutory interpretation of tax laws.

Is There a Role for Economic Analysis When Deciding on State Aid to Public Broadcasters?

Is There a Role for Economic Analysis When Deciding on State Aid to Public Broadcasters?

Impact evaluation of merger decisions: lessons from the Greek experience

During the last decade, the importance of a thorough and coherent ex-post merger review by competition authorities and courts has been increasing. Although it is widely acknowledged that addressing the competition concerns, which stem from consummated mergers, is a costly and time-consuming process, and that remedies (e.g. either structural or behavioural), when adopted, are often imperfect at best, sophisticated quantitative techniques are now available for competition agencies, attorneys and courts to help them assess the impact of a merger and the efficacy of related enforcement decisions, thus leading to improved decision-making. This article aims to cast light on the role of economic analysis in the merger case decisions. For this reason, I focus on the main quantitative techniques used in merger analysis in the Greek jurisdiction. In this way, I try to offer some suggestions to other competition agencies derived from the Hellenic Competition Commission experiences in assessing selected merger cases. Finally, I also delve into discussions of Greek competition law matters, as an example of emerging merger regime model, with respect to certain aspects of the European Union Merger Regulation.

Empirical assessment of the role of economic analysis in the Russian antitrust: Why is economic analysis used?

Economic analysis is an important tool for the modern antitrust. This article provides an empirical study of its role in the Russian antitrust law enforcement practice in order to answer the following question: Has the understanding of the usefulness and importance of economic analysis in the Russian antitrust been achieved, or has economic analysis been applied formally? The study is based on the sample of official records on published decisions by the Supreme Court of Arbitration of the Russian Federation, created specifically for this research.

Economic Analysis at the Federal Communications Commission, 2012–2013

Pointing to the role of economic analysis, this article reviews major Federal Communications Commission actions and initiatives that are related to universal service support in high-cost areas that are served by price-cap incumbent local exchange carriers, special access policy, secondary market spectrum transactions, spectrum reassignments, and rules that govern interoperability among certain licensees in the 700 MHz band and spectrum ownership. Also discussed are activities of the recently created Technology Transitions Policy Task Force and challenges to communications policy that are posed by the transition to voice over internet protocol interconnection.

Symposium on revealed preference analysis

Almost invariably, economic models postulate that agents behave according to some type of maximizing behavior. This is true even of models in behavioral economics, though agents in those settings may be unsophisticated in some way or have preferences that depart from classical assumptions. Revealed preference (RP) analysis investigates the observable implications of economic models and the extent to which the objects of a model, for example, agents’ preferences, can be inferred from data. While RP analysis in this broad sense applies, of course, to a very large part of empirical investigation in economics, that literature which is typically understood by its practitioners as revealed preference analysis has more specific features: In general, the aim of the analysis is not merely to identify and test some empirical implications of a model, but to identify all the observable implications of a model. These implications take the form of restrictions on the data that could, at least in principle, be checked. Since the models being considered are usually sufficiently general that its objects are restricted by qualitative, rather than functional-form or parametric conditions, the same is true of the restrictions on the data. This is an ambitious approach to empirical investigation, and it is probably not practicable to adopt it in all circumstances, but for models that play a central role in economic analysis, it is worthwhile delineating exactly the observable content of the model.

Australian Legume Research – synthesis and future directions

The Australian Legumes Symposium was the first in a planned series of regular technical symposia organised by the Australian Grasslands Association. The aim was to provide researchers with the opportunity to interact, present up-to-date reviews on topics related to pasture legume science, present results of current research and participate in planning of future research and development relevant to pasture legumes. This paper is intended to be the key output of the forum – a summary of findings and highlights from review and contributed research papers as well as identifying key research priorities for the future. In terms of the former, reviews presented at the symposium provided an overview of the development and role of pasture legumes in temperate farming systems. Closely related topics – nitrogen (N) fixation, N balance of farming systems and management of legume inoculation provided a focus on the importance of legumes in terms of N input and overall productivity. International perspectives on lucerne – its improvement and adoption provided a noticeable contrast to the apparent paucity of research into this species in Australia – despite its widespread use in temperate farming systems. In terms of content, there were many other papers delivered dealing with a wide diversity of relevant issues. On one hand the diversity of work in pasture legume research and development may stem from the wide array of expertise available in Australia and New Zealand, while on the other it might suggest that research and development inputs are being thinly spread over a large number of species. With respect to determining research priorities, it was surprising that participants were most concerned with how research is funded and conducted and the need to address this by reconsidering current arrangements. A greater role for economic analysis in determining research priorities was foreshadowed. The identification and management of acid-tolerant perennial legumes for higher rainfall zone permanent pastures was nominated as a major research priority, as was the need to address problems related to pre-inoculation of legume seed. The clear message from the symposium was that there needs to be a reorganisation of pasture legume improvement in order for gains to be effectively realised, and to maintain research and development capacity.

The Integration of Environmental Issues in The Agricultural Policy: The Role of Economic Evaluation

The integration of environmental issues into agricultural policies has attracted significant attention in recent years. The objective of this paper is to discuss the (past and future) research questions in this area and the role of economic analysis in supporting decisions regarding the integration of environmental issues into agricultural policies, with a special focus on the Common Agricultural Policy (CAP) of the European Union (EU). The paper first examines the evolution of the process integrating environmental concerns into the CAP. Then, the role of economic analysis is discussed with reference to selected major issues, including: the evaluation of the relationship between agriculture and environmental impacts, and the economic value of such effects; the evaluation of policy effectiveness and efficiency; optimal policy design; the effects on markets and farm structures; and the coordination and governance of policy measures. The contents of these study areas are discussed and the research priorities required to meet future needs are identified. The work concludes by highlighting the need to develop more detailed policy analysis studies while, at the same time, developing a wider and more innovative vision of the role of agricultural policy in the global context.

Book Review: The Role of Economic Analysis in the EC Competition Rules, by Doris Hildebrand. 3rd edn (Alphen a/d Rijn: Kluwer Law International, 2009)

Book Review: <i>The Role of Economic Analysis in the EC Competition Rules</i>, by Doris Hildebrand. 3rd edn (Alphen a/d Rijn: Kluwer Law International, 2009)

Recreational, Cultural and Aesthetic Services from Estuarine and Coastal Ecosystems

The role of economic analysis in guiding the sustainable development of estuarine and coastal ecosystems is investigated based on a comprehensive review of the literature on the valuation of the recreation, cultural and aesthetic services. The implications of the findings for the sustainable management of coral reefs, Marine Protected Areas, and Small Island Developing States are discussed. Finally, the potential of meta-analytical benefit transfer and scaling up of values at various aggregation levels is demonstrated in the context of coastal tourism and recreation in Europe. The results of the study support the conclusion that the non-material values provided by coastal and estuarine ecosystems in terms of recreational, cultural and aesthetic services represent a substantial component of human well-being.

European State Aid Policy in Search of a Standard - What is the Role of Economic Analysis?

In the early years of enforcement of antitrust and of State aid in Europe, given the integration objectives that the European Treaty pursues, fairness seemed the most natural standard to choose. In antitrust it took more than forty years to convince the Commission and the Courts of the soundness of the effect based approach. By enhancing the role of economic analysis, the objective of the 2005 State Aid Action Plan was to modernize State aid policy. Unfortunately the Commission did not go as far as suggesting that distortions of competition be noticeable before a State measure is declared incompatible. As a result, EU policy continues to be over extensive addressing cases where the distortions of competition are minimal. This is particularly the case for restructuring aid, where the effects of the aid on competition are hardly analyzed in the Commission decisions. In these cases the restoration of the healthiness of the firm is the final objective of the aid. However the Commission, while often authorizing the aid, tries to overcome moral hazard by attaching a number of very intrusive conditions to its authorization decisions (prohibition of reducing prices before a competitor does, introduction of capacity or sales caps, etc). These conditions reduce, not increase, the possibility of these companies to successfully restructure. Moral hazard can only be eliminated by not allowing the aid, not by constraining the company from competing. Finally when the anticompetitive effect of the aid is only indirect, restitution of the aid requires a very difficult calculation of the added value of the aid on the market equilibrium. A very complex calculation to be performed and hardly capable of being established by a Court. A new and different criterion should be devised for sanctioning indirect aid.

The Doha agenda and agricultural trade reform: the role of economic analysis

AbstractThis article shows that research on international agricultural trade reform can make much greater contributions to understanding than was feasible in earlier trade negotiations. While current models typically estimate gains of less than 1% of GDP, new developments in theory and methodology provide the potential for quantitative analysis to be improved in at least six areas: measurement of protection for goods; incorporation of barriers to foreign trade and investment in services; representation of the counterfactual; disaggregation of products and regions; incorporation of new products; and inclusion of the productivity enhancement associated with trade reform.

Abuse of Dominance: How Far are the EU and the US?

In recent years economic analysis has become more and more important in antitrust enforcement in Europe. First in merger control, then in vertical agreements the case by case approach based on a substantive appreciation of the restrictions of competition is becoming more and more prevalent. On abuse of dominance the difference between the US and the EU is still relevant. However, especially after the December 2005 publication by the European Commission of the Discussion paper on the application of Article 82 of the Treaty to exclusionary abuses the gap has been reduced, at least in terms of the general approach to abuse cases. In practice, even though the role of economic analysis is much more refined and relevant than in the past, the European Commission continues to be more interventionist than US antitrust enforcers. This outcome depends very much on the widespread use of presumptions and truncated analysis on both sides of die Atlantic. A number of examples are provided on predation, discounts, refusal to deal, tying and bundling.

Article 82 Rebates: Four Common Fallacies

In light of the ongoing review of the policy on the application of Article 82 EC by the European Commission, this paper first describes how to calculate potential foreclosure effects and then sets out some common fallacies to be found in the discussion of rebate schemes. The paper discusses the averaging fallacy in calculating foreclosure in rebate schemes, addresses the ex post fallacy, according to which demand realizations ex post are evidence for determining foreclosure and the coverage fallacy according to which low market coverage implies a lack of foreclosure. The discussion of the case-by-case fallacy focuses on the idea that even if a subset of rebate schemes could be justified by efficiencies, alternative pricing instruments may have the same beneficial effects without negative effect on competition and even a flat out prohibition may therefore not reduce but increase welfare. I conclude with a more general discussion of the role of economic analysis in competition policy.

The role of economic analysis in policy making — a tobacco control case study

Economic analyses and modelling can influence the development of public health policy by providing evidence about the economic impact of different policies and the return on investment for policy changes, as well as any differential outcomes arising from policy implementation. Such analyses can also provide data relevant to broader factors that impact on policy decisions. This article describes the use of an economic analysis of a reduction in smoking prevalence to counter competing claims of industry interest groups, and to identify the potential beneficiaries of tighter tobacco control policies.