Are Prices Really Affected by Mergers?

During the 80s, several empirical studies have shown a positive correlation between concentration, prices and profits. It is well known that these estimates all suffer from simultaneity bias: market structure and prices are affected by common factors, some of which are not observable, which rules out any causal interpretation of cross-sectional correlations. Mergers are an interesting instrument to identify the (static) impact of concentration on prices, since they induce breaks in strategic interactions between actors. The few ex post studies on mergers that are currently available are difficult to generalize, because they pertain to specific markets. This study looks more systematically to selling prices in 63 sectors observed between 1989 and 2002. The approach that has been chosen is a difference in differences approach, applied to price movements around mergers. The rate of inflation in a sector where a merger has occurred is compared to a counterfactual. In a simple framework, in line with previous studies (McCabe 2002), this counterfactual would be built as the mean of inflation rates in other sectors. This paper focuses on more relevant estimates, provided by a factor model. This methodology allows tracking the profile of prices around mergers. We separate mergers between French firms and mergers between other European firms controlled by European authorities (and thus assumed to have affected the common market). We also distinguish mergers having led to an in-depth inquiry by competition authorities (« phase 2 ») and those benefiting from a shorter procedure (« phase 1 »). We observe an acceleration of price movements around the most important of French mergers, but not for the ones authorized under phase 1. We also observe a break in price movements for mergers between foreign firms examined by the European Commission, generally in the other direction.mergers, prices, factor models

The Effects of Retail Regulations on Prices Evidence form the Loi Galland

In 1997, a new legislation banning below-invoice retail prices came into force in France. Individually negotiated discounts could no longer be passed on to consumers, which is equivalent to allowing industry-wide price oors. The anti-competitive effects of such practices are well-known. The elimination of intra-brand competition is expected to lead to a sharp increase in the retail prices. Using CPI raw data, we nd evidence supporting this claim. The modification or revocation of the existing legislation (as it has been done in Ireland in December 2005) would then be expected to reduce retail prices.retail prices, pricing regulations, resale price maintenance

An accounting evaluation of user cost of capital for French firms: 1984-2002

This work presents a methodology to evaluate user cost of capital using firm level accounting data for French firms between 1984 and 2002. This evaluation relies on a modelling of individual user cost of capital that accounts for the structure of the financing of the firm, banking interest rates and the taxation of firms and shareholders. The model used in the paper comes from Crépon, Gianella (2001) and is inspired from Jorgenson (1963) and Auerbach (1983). We insist on the fact that the cost to use some capital actually depends on the nature of the assets that will be financed. The evaluation should then fit with the question at issue. Finally, the contribution of the paper is to use firm or sector level data each time these are available. Thus, the evaluation relies on an individual estimation of the taxation of benefits and uses sectorial life spans of capital computed by Picart (2004).User cost of capital, taxation, firm level data

The Environmental Effect of Green Taxation: the Case of the French "Bonus/Malus"

At the beginning of 2008 was introduced in France a feebate on the purchase of new cars called the Bonus/Malus. Since January 2008, less polluting cars benefit from a price reduction of up to 1,000 euros, while the most polluting ones are subject to a taxation of 2,600 euros. We estimate the impact of this policy on carbon dioxide emissions in the short and long run. These emissions depend on the market shares and the average emissions per kilometer of each car, but also on their manufacturing, car fleet size and the average number of kilometers travelled by their owners. We first develop a simple tractable model that relates car choice and mileage. We then estimate this model, using both the exhaustive dataset of car registrations and a recent transportation survey which provides information on individual journeys. We show that if the shift towards classes benefiting from rebates is spectacular, the environmental impact of the policy is negative. The reform has notably increased sales, leading to an important increase in manufacturing and travelling emissions. We thus stress that such policies may be efficient tool for reducing CO2 emissions since consumers do react to such financial incentives, but should be designed with care to achieve their primary goal.environmental taxation, automobiles, carbon dioxide emissions, policy evaluation

The deep-pocket effect of internal capital markets

We provide evidence that incumbent and entrant firms' access to business group deep pockets affects entry patterns in product markets. Relying on a unique French data set on business groups, our paper shows that entry in manufacturing industries is negatively related to the cash hoarded by incumbent-affiliated groups, and positively related to entrant groups' cash. In line with theoretical predictions, we find that the impact on entry of group cash holdings is more important in environments where financial constraints are pronounced and in more financially dependent sectors. The cash holdings of incumbent and entrant groups also affect the survival rate of entrants in the 3 to 5 year post-entry window. Overall, our findings suggest that internal capital markets operate within corporate groups and affect the product market behavior of affiliated firms by mitigating financial constraints

The Impact of Dielectric Constant Model and Surface Reference on Differences Between SMOS and Aquarius Sea Surface Salinity

Two ongoing space missions share the scientific objective of mapping the global Sea Surface Salinity (SSS), yet their observations show significant discrepancies. ESA's Soil Moisture and Ocean Salinity (SMOS) and NASA's Aquarius use L-band (1.4 GHz) radiometers to measure emission from the sea surface and retrieve SSS. Significant differences in SSS retrieved by both sensors are observed, with SMOS SSS being generally lower than Aquarius SSS, except for very cold waters where SMOS SSS is the highest overall. Figure 1 is an example of the difference between the SSS retrieved by SMOS and Aquarius averaged over one month and 1 degree in longitude and latitude. Differences are mostly between -1 psu and +1 psu (psu, practical salinity unit), with a significant regional and latitudinal dependence. We investigate the impact of the vicarious calibration and retrieval algorithm used by both mission on these differences

High-resolution measurement of the time-modulated orbital electron capture and of the β+\beta^+ decay of hydrogen-like 142^{142}Pm60+^{60+} ions

The periodic time modulations, found recently in the two-body orbital electron-capture (EC) decay of both, hydrogen-like $^{140}$Pr$^{58+}$ and $^{142}$Pm$^{60+}$ ions, with periods near to 7s and amplitudes of about 20%, were re-investigated for the case of $^{142}$Pm$^{60+}$ by using a 245 MHz resonator cavity with a much improved sensitivity and time resolution. We observed that the exponential EC decay is modulated with a period $T = 7.11(11)$s, in accordance with a modulation period $T = 7.12(11)$ s as obtained from simultaneous observations with a capacitive pick-up, employed also in the previous experiments. The modulation amplitudes amount to $a_R = 0.107(24)$ and $a_P = 0.134(27)$ for the 245 MHz resonator and the capacitive pick-up, respectively. These new results corroborate for both detectors {\it exactly} our previous findings of modulation periods near to 7s, though with {\it distinctly smaller} amplitudes. Also the three-body $\beta^+$ decays have been analyzed. For a supposed modulation period near to 7s we found an amplitude $a = 0.027(27)$, compatible with $a = 0$ and in agreement with the preliminary result $a = 0.030(30)$ of our previous experiment. These observations could point at weak interaction as origin of the observed 7s-modulation of the EC decay. Furthermore, the data suggest that interference terms occur in the two-body EC decay, although the neutrinos are not directly observed.Comment: In memoriam of Prof. Paul Kienle, 9 pages, 1 table, 5 figures Phys. Lett. B (2013) onlin

When do myopia genes have their effect? Comparison of genetic risks between children and adults

Previous studies have identified many genetic loci for refractive error and myopia. We aimed to investigate the effect of these loci on ocular biometry as a function of age in children, adolescents, and adults. The study population consisted of three age groups identified from the international CREAM consortium: 5,490 individuals aged 25 years. All participants had undergone standard ophthalmic examination including measurements of axial length (AL) and corneal radius (CR). We examined the lead SNP at all 39 currently known genetic loci for refractive error identified from genome-wide association studies (GWAS), as well as a combined genetic risk score (GRS). The beta coefficient for association between SNP genotype or GRS versus AL/CR was compared across the three age groups, adjusting for age, sex, and principal components. Analyses were Bonferroni-corrected. In the age group <10 years, three loci (GJD2, CHRNG, ZIC2) were associated with AL/CR. In the age group 10–25 years, four loci (BMP2, KCNQ5, A2BP1, CACNA1D) were associated; and in adults 20 loci were associated. Association with GRS increased with age; β = 0.0016 per risk allele (P = 2 × 10–8) in <10 years, 0.0033 (P = 5 × 10–15) in 10- to 25-year-olds, and 0.0048 (P = 1 × 10–72) in adults. Genes with strongest effects (LAMA2, GJD2) had an early effect that increased with age. Our results provide insights on the age span during which myopia genes exert their effect. These insights form the basis for understanding the mechanisms underlying high and pathological myopia

Islands beneath islands: phylogeography of a groundwater amphipod crustacean in the Balearic archipelago

<p>Abstract</p> <p>Background</p> <p>Metacrangonyctidae (Amphipoda, Crustacea) is an enigmatic continental subterranean water family of marine origin (thalassoid). One of the species in the genus, <it>Metacrangonyx longipes</it>, is endemic to the Balearic islands of Mallorca and Menorca (W Mediterranean). It has been suggested that the origin and distribution of thalassoid crustaceans could be explained by one of two alternative hypotheses: (1) active colonization of inland freshwater aquifers by a marine ancestor, followed by an adaptative shift; or (2) passive colonization by stranding of ancestral marine populations in coastal aquifers during marine regressions. A comparison of phylogenies, phylogeographic patterns and age estimations of clades should discriminate in favour of one of these two proposals.</p> <p>Results</p> <p>Phylogenetic relationships within <it>M. longipes </it>based on three mitochondrial DNA (mtDNA) and one nuclear marker revealed five genetically divergent and geographically structured clades. Analyses of cytochrome oxidase subunit 1 (<it>cox1</it>) mtDNA data showed the occurrence of a high geographic population subdivision in both islands, with current gene flow occurring exclusively between sites located in close proximity. Molecular-clock estimations dated the origin of <it>M. longipes </it>previous to about 6 Ma, whereas major cladogenetic events within the species took place between 4.2 and 2.0 Ma.</p> <p>Conclusions</p> <p><it>M. longipes </it>displayed a surprisingly old and highly fragmented population structure, with major episodes of cladogenesis within the species roughly correlating with some of the major marine transgression-regression episodes that affected the region during the last 6 Ma. Eustatic changes (vicariant events) -not active range expansion of marine littoral ancestors colonizing desalinated habitats-explain the phylogeographic pattern observed in <it>M. longipes</it>.</p