Taking God Seriously, but Not Too Seriously: The Divine Command Theory and William James' 'The Moral Philosopher and the Moral Life’

While some scholars neglect the theological component to William James’s ethical views in “The Moral Philosopher and the Moral Life,” Michael Cantrell reads it as promoting a divine command theory (DCT) of the foundations of moral obligation. While Cantrell’s interpretation is to be commended for taking God seriously, he goes a little too far in the right direction. Although James’s view amounts to what could be called (and what Cantrell does call) a DCT because on it God’s demands are necessary and sufficient for the highest obligations, this is a view with characteristics unusual for a DCT. It only holds for some obligations; on it moral obligation does not derive from God’s authority; it is not obvious that James believes the God required by it even exists; we do not know what God’s demands are; and, finally, since we do not know them, we cannot act on them. (Lest there be any confusion, the titular phrase "taking God seriously, but not too seriously" describes William James' view of God and morality, not my own view.

Firms Merge in Response to Constraints

Theoretical IO models of horizontal mergers and acquisitions make the critical assumption of efficiency gains.Without efficiency gains, these models predict either that mergers are not profitable or that mergers are welfare reducing.A problem here is the empirical observation that on average mergers do not create efficiency gains.We analyze mergers in a model where firms cannot equalize marginal costs and marginal revenues over all dimensions in their action space due to constraints.In this type of model mergers can still be profitable and welfare enhancing while they create a loss in efficiency.The merger allows a firm to relax constraints.Further, this set up is consistent with the following stylized facts on mergers and acquisitions: M&A's happen when new opportunities have opened up or industries have become more competitive (due to liberalization), they happen in waves, shareholders of the acquired firms gain while shareholders of the acquiring firms lose from the acquisition. Standard IO merger models do not explain these empirical observations.Pro/anti-competitive mergers;efficiency defence;constraints;merger waves;deregulation

Technological progress and unemployment

welfare;technoligical change;unemployment

Competitive Pressure, Selection and Investments in Development and Fundamental Research

This paper analyses the effects of competitive pressure on a firm's incentives to undertake both fundamental research and development. It presents a new framework incorporating the selection effect of product market competition, the Schumpeterian argument for monopoly power, the Nickell/Porter argument for competitive pressure and the infant industry argument for protection. The key insight is that the effects of competitive pressure on a firm's incentives to innovate depend on the firm's efficiency level relative to that of its opponents. Finally the effects of competitive pressure on industry wide fundamental research and development are analyzed. It turns out that there is a trade off between development and fundamental research: a rise in competitive pressure cannot raise both types of innovative activity at the industry level.Competition;R&D;Selection

Balance of Power

This paper argues that the efficiency distribution of players in a game determines how aggressively these players interact.We formalize the idea of balance of power: players fight very inefficient players but play softly versus equally (or more) efficient players.This theory of conduct predicts that entry by new firms leads to a less aggressive outcome if it creates a balance of power. A balance of power is created if more players get technologies that are close to the most efficient technology.Using a related argument, we show that an increase in entry costs can lead to more aggressive outcomes.pricing games;Folk theorem;refinement of predicted outcomes;supergames;contestable market

Competition

Competition has been modelled in the literature in a number of ways.What do these different parametrizations of competition have in common?For instance, it turns out that it is not always the case that a rise in competition reduces price cost margins, industry wide profits or concentration.All parametrizations of competition, considered here, have two features in common.First, the reallocation effect: a rise in competition raises the profits of a firm relative to the profits of a less efficient firm.Second, a rise in competition reduces the profits of the least efficient firm active in the industry.competition;industrial concentration;profit

Optimal Competition: A Benchmark for Competition Policy

This paper introduces optimal competition: the best form of competition in an industry that a competition authority can achieve under the information constraint that it cannot observe firms' effciency levels.We show that the optimal competition outcome in an industry becomes more competitive as more money is spent in the industry, as the competition authority puts less weight on producer surplus and more weight on employment.The relation between competition and entry costs is U-shaped.Finally conditions are derived under which Cournot competition is too competitive compared to the optimal competition outcome.competition;trade policy;trade liberalization;regulations;benchmark