Matias PIETOLA will defend his thesis on Tuesday 30 June 2020 at 11:00 am on «Essays on Pricing and Competition».
By Zoom meeting.
If you want to join the meeting, please contact Professor Patrick Rey
Supervisor: Professor Patrick REY, University of Toulouse 1 Capitole - TSE
- Massimo MOTTA, University of ICREA - POMPEU FABRA
- Professeur Paul BELLEFLAMME, University of LOUVAIN
- Professeur Juuso VÄLIMÄKI, University of AALTO
- Professeur Takuro YAMASHITA, Toulouse School of Economics, UTC
- Professeur Yassine LEFOUILI,Toulouse School of Economics, UTC
- Professeur Patrick REY, Toulouse School of Economics, UTC
The thesis consists of an introduction and three self-contained chapters. The first and the third chapters analyze the interaction between competition and cooperation, whereas the second one is about pricing and incentives.
Motivated by recent antitrust cases in the pharmaceutical industry, the first chapter studies the interplay between pay-for-delay settlements, licensing deals and litigation. The analysis highlights the externalities that they generate: pay-for-delay settlements reduce competition which encourages entry; licensing and litigation make entering less profitable. Faced with multiple entrants, the incumbent exploits these externalities by offering licensing deals to some entrants or by pursuing litigation in order to decrease the cost of delaying contracts offered to others. The number of delayed entrants increases with patent strength. Entrants without pay-for-delay settlements pursue litigation for patents of intermediate strength; otherwise, they receive licensing deals.
The second chapter studies the conditions under which an intermediary can decentralize the pric- ing decisions of a transaction to privately informed parties. The analysis shows that decentralized pricing is both necessary and sufficient for ex post incentive compatibility if the parties have nega- tively interdependent transaction values (as is often the case in transactions between buyers and sellers: an increase in the quality of the good makes purchasing it more attractive, but increases the seller’s opportunity cost). On the contrary, with positive interdependence, we obtain a negative result. The results provide new insights into robust trading mechanisms, the equivalence between Bayesian and dominant strategy implementation, tax incidence, and pricing in two-sided markets.
The third chapter studies advertising sales’ cooperation between media platforms (television or radio channels, newspapers, etc.) that compete over content offered to consumers. A sales represen- tation agreement, whereby one of the platforms delegates its advertising sales to another platform, in exchange for a fee per subscriber, not only increases the price of advertising, but also reduces content investment. Revenue sharing leads to even less content investment, as the platforms free-ride on the content paid by the othe