Topic
Cross subsidization
About: Cross subsidization is a research topic. Over the lifetime, 169 publications have been published within this topic receiving 3318 citations.
Papers published on a yearly basis
Papers
Posted Content•
TL;DR: In this paper, the authors provide an analysis of the incentives and outcomes inherent in the management of professional team sports cartels and provide new results concerning salary caps, local TV revenue sharing, and the behavior of cartel managers in the face of rival leagues.
Abstract: Professional team sports leagues provide insight into the problems facing the management of functioning cartels This paper provides an analysis of the incentives and outcomes inherent in the management of professional team sports cartels Except for revenue sharing and salary caps, league cartel management outcomes are consistent with league-wide revenue maximization and have no impact on competitive balance However, there are predictable impacts on the profitability of strong- and weak-drawing teams within the league While providing an analytical review of the literature, the work here also yields new results concerning salary caps, local TV revenue sharing, and the behavior of cartel managers in the face of rival leagues
776 citations
Posted Content•
TL;DR: In this paper, the issues of cross-subsidization in public enterprises with economies of joint production are analyzed, and the relation of welfare maximizing prices to subsidy-free prices is discussed.
Abstract: Analyzes the issues of cross-subsidization in public enterprises with economies of joint production. Incentives to competitive entry and subsidy-free prices; Relation of welfare maximizing prices to subsidy-free prices; Price elasticity of demand; Costs of alternative means of supply; Choice between protected monopoly and open competition.
441 citations
TL;DR: In this article, the configuration of equilibrium in the market for automobile collision insurance is examined empirically by representing the premium-deductible menu and the demand function as a standard hedonic system.
Abstract: The configuration of equilibrium in the market for automobile collision insurance is examined empirically by representing the premium-deductible menu and the demand function as a standard hedonic system. Using contractual data from a representative insurer, we estimate a reduced-form hedonic premium equation and the inverse of the marginal bid equation for insurance coverage. The data reveal an equilibrium with adverse selection and market signaling but lead us to reject the hypothesis that high risks receive contracts subsidized by low risks.
339 citations
TL;DR: Wang et al. as discussed by the authors formulated a two-sided platform's profit maximization problem by considering network externality, and focused on three pricing strategies, membership-based pricing, transaction-based, and cross subsidization.
Abstract: Nowadays many platforms emerge to provide delivery services by having independent shoppers to deliver groceries from independent retailers to consumers. To understand how to price this service, we formulate a two-sided platform’s profit maximization problem by considering network externality. We focus on three pricing strategies, membership-based pricing, transaction-based pricing, and cross subsidization. When time discounting is absent and consumers’ order frequency is price-insensitive, it is shown that these three strategies are equivalent. As membership-based pricing collects money the earliest and maximize price-sensitive order frequency, our analysis explains some platforms’ promotion of it.
194 citations
TL;DR: In this article, the authors analyze how contractibility affects contract design and show that, when research activities are not contractible, an option contract is optimal, while contracts with termination options are more common when research is non-contractible.
Abstract: We analyze how contractibility affects contract design. A major concern when designing research agreements is that researchers may use their funding to subsidize other projects. We show that, when research activities are not contractible, an option contract is optimal. The financing firm obtains the option to terminate the agreement and, in case of termination, broad property rights. The threat of termination deters researchers from cross-subsidization, and the cost of exercising the termination option deters the financing firm from opportunistic termination. We test this prediction using 580 biotechnology research agreements. Contracts with termination options are more common when research is non-contractible.
154 citations
Related Topics (5)
Performance Metrics
| Year | Papers |
|---|---|
| 2021 | 4 |
| 2020 | 8 |
| 2019 | 8 |
| 2018 | 9 |
| 2017 | 6 |
| 2016 | 7 |