Public Goods Provision by a Private Cartel

Schinkel, Maarten Pieter; Tóth, Lukáš

doi:10.2139/ssrn.3509062

Cited by 5 publications

(2 citation statements)

References 36 publications

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“…Gans and Groves (2012) model carbon offsetting as a private public good contribution to find that offsets generally decrease net emissions in competitive markets, but may not when "dirty" producers have market power. Schinkel and Tóth (2019) study a setting where cartels are allowed if consumers are compensated by public good provision. Cartels provide minimal public goods for maximal private overcharges.…”

Section: Related Literaturementioning

confidence: 99%

Corporate Social Responsibility by Joint Agreement

Schinkel,

Treuren

2021

SSRN Journal

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Industry-wide voluntary agreements are touted as a means for corporations to take more corporate social responsibility (CSR). We study what type of joint CSR agreement induces competitors to increase CSR efforts in a model of oligopolistic competition with differentiated products. Consumers have a willingness to pay for more responsibly manufactured products. Firms are driven by profit, and are also possibly intrinsically motivated, to invest in CSR efforts. We find that cooperative agreements directly on the level of CSR reduce CSR efforts compared to competition. Such agreements throttle both for-profit and intrinsic motivation for CSR. CSR efforts only increase if agreements are permitted solely on output. Such production agreements, however, reduce total welfare in the market and raise antitrust concerns. Taking externalities into account may help justify a production agreement under a broader welfare standard, but not agreements on CSR directly. Moreover, simply requiring a higher CSR level by regulation while preserving competition always gives higher within-market welfare.

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Section: Related Literaturementioning

confidence: 99%

Corporate Social Responsibility by Joint Agreement

Schinkel,

Treuren

2021

SSRN Journal

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“…whether competition authorities should take into account public interests above competition objectives. Existing works focused on the issue of environmental protection assume that …rms'contributions to environmental protection are voluntary (Hashimzade and Myles (2017), Schinkel and Toth (2019), Spiegel andSchinkel (2017), Treuren andSchinkel (2018)). In contrast, our analysis states that …rms' decisions are constrained by environmental liability, and suggests that this raises coordination issues between Courts (focused on the incentives to precautionary expenditures) and Competition Authorities (focused on consumers surplus), in order to improve environment protection measures.…”

Section: Introductionmentioning

confidence: 99%

Should environment be a concern for competition policy when firms face environmental liability?

Charreire

Langlais

2021

International Review of Law and Economics

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This paper considers an oligopoly where …rms produce a joint and indivisible environmental harm as a by-product of their output. We …rst analyze the e¤ects on the equilibrium of alternative designs in environmental liability law, secondly, we discuss the rationale for "non-conventional" competition policies, i.e. more concerned with public interest such as the preservation of human health or environment. We study …rms decisions of care and output under various liability regimes (strict liability vs negligence) associated with alternative damages apportionment rules (per capita vs market share rule), and in some cases with damages multipliers. We …nd that basing an environmental liability law on the combination of strict liability, the per capita rule, and an "optimal" damages multiplier, is consistent with a conservative competition policy, focused on consumers surplus, since, weakening …rms' market power also increases aggregate expenditures in environment preservation and social welfare. In contrast, a shift to the market share rule, or to a negligence regime, may be consistent with a restriction of competition, since …rms'entry may instead lead to a decrease in aggregate environmental expenditures and losses of social welfare. Nevertheless the …ne tuning of the policy requires speci…c information from a Competition Authority, which we discuss as well.

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Corona Crisis Cartels: Sense and Sensibility

Schinkel

2020

SSRN Journal

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Public Goods Provision by a Private Cartel

Cited by 5 publications

References 36 publications

Corporate Social Responsibility by Joint Agreement

Corporate Social Responsibility by Joint Agreement

Should environment be a concern for competition policy when firms face environmental liability?

Corona Crisis Cartels: Sense and Sensibility

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