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This study estimates the competitive effects of horizontal mergers in the French long-distance bus industry. We examine the two mergers that followed the 2015 Deregulation Act (the Macron Law); we use an exclusive and exhaustive dataset that covers eight consecutive quarters. We analyze the merger effects by comparing bus links that were affected by mergers with those that were unaffected; we use difference-in-differences estimations. We find that the two mergers are associated with price increases of about 13.5% immediately that then moderate to 5.3%; and with the frequency decreases from - 21.5 to - 25.7%; we observe no effects on load factors. These findings show evidence of short-run anticompetitive effects, while the mergers under study were not scrutinized by the French competition agency, as they were below the notification thresholds.

Conceived as a theory of competitive harm, self-preferencing has been at the core of recent European landmark cases (e.g., Google Android, Google Shopping). In the context of EU competition law, beyond the anticompetitive leveraging effect, self-preferencing may lead to vertical and horizontal exclusionary abuses, encourage exploitation abuses, and generate economic dependence abuses. In this paper, we aim at characterizing the various forms of self-preferencing, investigating platforms’ capacity and incentives to do so through their dual role, by shedding light on the economic assessment of these practices in an effects-based approach. We analyze the different options for remedies in this context, by insisting on their necessity, adequacy, and proportionality.

International audience; Notre propos est de fournir un éclairage économique sur certaines des dimensions liées au traitement concurrentiel des restrictions verticales. En effet, celles‑ci peuvent avoir des effets pro-concurrentiels qui sont susceptibles de conduire à un effet net positif sur le surplus du consommateur, notamment au travers d’un impact positif sur la qualité des produits et des services et sur les incitations à investir et à innover pour les firmes. Il s’agit d’interroger, selon une perspective d’économie industrielle, différentes dimensions de ces accords verticaux susceptibles de justifier une exemption par catégorie

International audience; In the European rail industry, to enable competition in the market, entrants should be granted access to a large set of complementary services, beyond access to the tracks. For an efficient and effective entry, temporary access to quasi-essential complementary assets like rolling stock, mechanical maintenance workshops, data, schedules, etc. is required. In the liberalized rail sector, several observed anticompetitive practices involve distorted access to these quasiessential facilities. Therefore, competition agencies must deal with litigation between the incumbent and new entrants. Most cases have been settled, resulting in commitments from the incumbent. We argue that such transitory and case-by-case remedies fail to produce favorable conditions for a secure and efficient entry. Thus, we propose to systematize such remedies through asymmetric and enduring ex-ante regulation.

GREDEG Working Paper No. 2020-56; During the 1920s, two different proposals of a regulated competition competed in the US. The first, inspired by trade associations, was advocated by Herbert Hoover. This approach echoes a managerialist view of a coordinated competition under state support. The second - promoted by Louis Brandeis - provides an alternative view of what a regulated competition should be: avoiding a ruinous competition through information exchange among small firms. From his involvement in the Wilson’s campaign team in 1912, to his dissent in the American Colum ruling of the US Supreme Court in 1923 and his position against the National Industrial Recovery Act in Schechter Poultry in 1935, we argue that Louis Brandeis was constant in his opposition to such a convergence between Big Business and Big Government. His intemporal coherence relies in his Jeffersonian approach advocating for a dispersion of economic powers for both efficiency and political purposes. At the opposite, both the trade associations’ movement and the NIRA experience pertain to a Hamiltonian perspective that is based on an equilibrium between the economic gains resulting from concentration or coordination and a strong political control.Available at: http://www.gredeg.cnrs.fr/working-papers/GREDEG-WP-2020-56.pdf

International audience; This article conducts a detailed analysis of the concept of economic dependence and exploitative abuse based on how their treatment in competition law and economics and their enforcement in European case law have evolved. Although the theoretical roots of these concepts lie in economic theory, these issues have been ignored or considered only scantily in the context of competition law enforcement. An effects-based approach should take these problems into account and could provide insights into how to portray the impacts of these abuses. We draw on two examples – from the agri-food industries and the digital economy – of relevant economic dependence issues. This paper highlights the existence of a paradox: although industrial organization models provide relevant tools to characterize these abuses, assess their effects, and devise remedies, it seems that they are seldom used by competition law enforcers.; Cet article analyse les concepts d’abus d’exploitation et de dépendance économique, non seulement sous le prisme de la jurisprudence concurrentielle européenne mais également sous celui de l’économie industrielle. Bien que les racines théoriques de ces concepts reposent sur la théorie économique, ils ont été ignorés ou peu pris en compte dans le contexte de l’application du droit de la concurrence. Une approche fondée sur les effets (effects-based) devrait tenir compte de ces pratiques et pourrait fournir des indications sur la façon d’analyser leurs impacts. Nous nous appuyons sur deux exemples tirés des industries agro-alimentaires et de l’économie numérique. Le présent article souligne l’existence d’un paradoxe : bien que les modèles d’organisation industrielle fournissent des outils pertinents pour caractériser ces abus, évaluer leurs effets et concevoir des mesures correctives, ils demeurent peu utilisés dans la pratique décisionnelle.

International audience

The duration of appellate court proceedings is an important determinant of the efficiency of a court system. We use data of 234 firm groups that participated in 63 cartels convicted by the European Commission between 2000 and 2012 to investigate the determinants of the duration of the subsequent one- or two-stage appeals process. We find that while the speed of the firststage appellate court decision depends on the court’s appeals-related workload, the complexity of the case, the degree of cooperation by the firms involved and the clarity of the applied rules and regulations, the second-stage appellate court proceedings appear to be largely unaffected by those drivers. We take our empirical results to derive conclusions for both firms that plan to file an appeal as well as public policy makers.

The opening up of the French long-distance bus industry is one of the outcomes of the Loi Macron . In this study, we build a unique data set of several representative bus routes and show that the effects of the liberalization have been encouraging in terms of fares, new entry, higher frequency, and higher quality. First, with regard to international routes that used to be under cabotage, we find that relaxing quantitative restrictions has led to the expected results on the Lyon–Torino and Paris–London routes. Second, with regard to domestic routes newly created from the Loi Macron , mostly all procompetitive expected variations in the variables have been observed, except for fares. Indeed, we show that bus operators used an initial aggressive pricing strategy to induce demand for the new services and then increased fares once customers became accustomed with the service.

International audience; Theoretical research has investigated the relevance of entry-inducing effects as countervailing factor to a merger-related increase in market power.We use route level data for the America West Airlines-US Airways merger (2005) to investigate whether such an effect can be identified empirically. Our results show that both entry-inducing and entry-dissuading effects can be observed depending on the type of affected route and the carrier under investigation.

International audience; The paper analyzes the interactions between trade and renewable energy policies based on the EU-China solar panel dispute which is the most significant antidumping (AD) complaint in Europe. We build a price competition duopoly model with differentiated products and intra-industry trade in photovoltaic (PV) equipment. We show that an optimal antidumping duty always increases with the feed-in tariff (FIT) program set in the home country. An appropriate antidumping duty - nullifying the dumping margin - decreases with the FIT program. We show that optimal FIT increases with the AD duty. Therefore, trade and renewable energy optimal policies may complement one another. Lastly, we introduce R\&D activities in the PV sector, and international spillovers. We show that R\&D makes the optimal FIT lower and increases the dumping margin. These effects are reinforced by technological spillovers.

The purpose of this article is to show, based on the case of the French market, that consumer perception of different funeral service offers, along with new entry in a special storing facility service (“chambre funéraire”), can be sufficient to impose competitive pressures on the various suppliers, including the former monopolist. With a discrete choice experiment implemented in Lyon, France, we find evidence that, contrary to widely shared beliefs about this specific market, demand for funeral services seems characterized by relatively high price elasticities, at least as soon as consumers are fully informed about the opportunities open to them in this market. Consumer behavior has actually changed in favor of a better assessment of the different possibilities of services supplied and of their relative price. We then implement simulations in local markets and show that, with good consumer information, the market power of the supposedly dominant firm is much less important than it is generally believed. Furthermore, simulations stress the procompetitive effects of setting up a new storing facility by any businesses. We finally show that, if some improvements can still be brought to the functioning of this market, they should come from a better regulation of consumer information and of the entry of firms.

En avril 2014, la Commission européenne a révisé ses Lignes directrices sur les aides d'Etat en matière d'énergie et d'environnement. Dans cet article, nous montrons comment l'analyse économique des effets des aides participe à la politique de la concurrence et propose un cadre rigoureux d'évaluation. Nous soulignons cependant que la manière dont les Lignes directrices présentent la nécessité des aides publiques est discutable. Deux logiques s'opposent en réalité, l'une distributive consistant à ne pas pénaliser les pollueurs domestiques vis-à-vis de la concurrence internationale, l'autre incitative dont l'objectif est de régler des externalités résiduelles. La Commission semble admettre trop rapidement les limites des politiques environnementales et ne met pas suffisamment en avant les externalités positives technologiques liées à l'innovation.

The duration of appellate court proceedings is an important determinant of the efficiency of a court system. We use data of 234 firm groups that participated in 63 cartels convicted by the European Commission between 2000 and 2012 to investigate the determinants of the duration of the subsequent one- or two-stage appeals process. We find that while the speed of the first-stage appellate court decision depends on the court’s appeals-related workload, the complexity of the case, the degree of cooperation by the firms involved and the clarity of the applied rules and regulations, the second-stage appellate court proceedings appear to be largely unaffected by those drivers. We take our empirical results to derive conclusions for both firms that plan to file an appeal as well as public policy makers.

French Abstract: En avril 2014, la Commission europeenne a revise ses Lignes directrices sur les aides d'Etat en matiere d'energie et d'environnement. Dans cet article, nous montrons comment l'analyse economique des effets des aides participe a la politique de la concurrence et propose un cadre rigoureux d'evaluation. Nous soulignons cependant que la maniere dont les Lignes directrices presentent la necessite des aides publiques est discutable. Deux logiques s'opposent en realite, l'une distributive consistant a ne pas penaliser les pollueurs domestiques vis-a-vis de la concurrence internationale, l'autre incitative dont l'objectif est de regler des externalites residuelles. La Commission semble admettre trop rapidement les limites des politiques environnementales et ne met pas suffisamment en avant les externalites positives technologiques liees a l'innovation.English Abstract: In April 2014, the European Commission has revised its guidelines on State aids for environmental protection and energy. In this article, we show how the economic analysis of the effects of the aid are useful in competition policy and proposes a rigorous evaluation framework. However, we emphasize that the way the Guidelines present the need of public support is questionable. Two logics are opposed in reality, the distributive one of not penalizing domestic polluters vis-a-vis international competition, the incentive one that aims to resolve residual externalities. The Commission appears to acknowledge too quickly the limitations of environmental policies and does not sufficiently highlight the positive externalities associated with innovation.

In this article, the authors interrogate legal and economic history to analyze the process by which the Chicago School of Antitrust emerged in the 1950s and became dominant in the United States. They show that the extent to which economic objectives and theoretical views shaped the inception of antitrust law. After establishing the minor influence of economics in the promulgation of U.S. competition law, they highlight U.S. economists’ caution toward antitrust until the Second New Deal and analyze the process by which the Chicago School developed a general and coherent framework for competition policy. They rely mainly on the seminal and programmatic work of Director and Levi (1956) and trace how this theoretical paradigm became collective—that is, the “economization” process in U.S. antitrust. Finally, the authors discuss the implications and possible pitfalls of such a conversion to economics-led antitrust enforcement.

International audience; Faced with the energy transition imperative, governments have to decide about public policy to promote renewable electrical energy production and to protect domestic power generation equipment industries. For example, the Canada - Renewable energy dispute is over Feed-in tariff (FIT) programs in Ontario that have a local content requirement (LCR). The EU and Japan claimed that FIT programs constitute subsidies that go against the SCM Agreement, and that the LCR is incompatible with the non-discrimination principle of the World Trade Organization (WTO). This paper investigates this issue using an international quality differentiated duopoly model in which power generation equipment producers compete on price. FIT programs including those with a LCR are compared for their impacts on trade, profits, amount of renewable electricity produced, and welfare. When 'quantities' are taken into account, the results confirm discrimination. However, introducing a difference in the quality of the power generation equipment produced on both sides of the border provides more mitigated results. Finally, the results enable discussion of the question of whether environmental protection can be put forward as a reason for subsidizing renewable energy producers in light of the SCM Agreement.

In this article, we use a history of economic thought perspective to analyze the process by which the Chicago School of Antitrust emerged in the 1950s and became dominant in the US. We show the extent to which economic objectives and theoretical views shaped antitrust laws in their inception. After establishing the minor influence of economics in the promulgation of U.S. competition laws, we then highlight U.S. economists' very cautious views about antitrust until the Second New Deal. We analyze the process by which the Chicago School developed a general and coherent framework for competition policy. We rely mainly on the seminal and programmatic work of Director and Levi (1956) and trace how this theoretical paradigm was made collective, i.e. the 'economization' process took place in US antitrust. Finally, we discuss the implications, if not the possible pitfalls, of such a conversion to economics-led competition law enforcement.

Etude pour le Ministère de l'Ecologie, du Développement Durable et de l'Energie.

International audience; The iPhone exclusivity deal illustrates the complex issue of exclusive arrangements in high-tech industries. Previous law cases on broadcasting right restrictions also highlighted the risk of anticompetitive foreclosure through such contractual clauses. This paper questions the French competition authorities' decisions in the light of economic analysis. If such exclusive agreements foster incentives to invest and innovate, they may also be considered as exclusionary practices.

Among other factors, one can assess the efficacy of a competition authority by its ability to choose and implement its remedies. Up until now, a dense economic literature has emerged on retrospective merger studies to measure the efficacy of merger control. Yet, little attention has been given to remedies in the other major pillar of competition policy, i.e. abuses of dominant position. In this paper, we try to fill the gap by first highlighting what is at stake and second analyse the most emblematic cases. We focus on the European Commission, while U.S. cases serve us as benchmark., L'efficacité d'une autorité de concurrence se reconnaît entre autre dans sa capacité à choisir et à mettre en oeuvre ses remèdes. Jusqu'à présent, une littérature économique dense s'est développée autour d'études rétrospectives en matière de concentrations pour juger de l'efficacité du contrôle et des remèdes retenus. En revanche, peu d'attention a été consacrée aux remèdes dans le cadre d'un autre grand pilier de la politique de concurrence, à savoir les pratiques unilatérales. Nous nous proposons ici de combler ce vide en essayant d'en cerner les principaux enjeux et d'analyser les affaires les plus emblématiques. Nous prenons comme cadre d'analyse le niveau européen avec l'antitrust américain comme point de comparaison.

International audience

The iPhone case illustrates the issue of exclusive dealing in high tech sectors. Previous law cases on broadcasting right restrictions highlighted the risk of anticompetitive foreclosure through such contractual clauses. This paper aims at confronting the French competition authorities' decisions with controversial debates in the field of economic theory. If on one hand such exclusive agreements foster incentives to invest and innovate, on the other hand they can be considered as exclusionary practices., L'affaire de l'exclusivité d'Orange sur les terminaux iPhone met en relief la problématique des clauses d'exclusivité dans le domaine des industries de haute technologie. Les contentieux déjà noués sur les droits audiovisuels avaient illustré les risques induits par ces dispositifs contractuels en termes de verrouillage du marché. Il s'agit dans le cadre de cet article de confronter la pratique décisionnelle des autorités nationales de la concurrence avec les controverses de la théorie économique. Les clauses d'exclusivité sont certes bénéfiques en termes d'incitations à l'investissement et à l'innovation mais peuvent s'avérer des vecteurs de stratégie d'éviction anticoncurrentielle.

International audience; This paper aims to analyze the effectiveness of asset transfers in preventing unilateral effects of a merger. We show that asset divestitures allow the remedying of certain price increases. Market size negatively impacts the scope of the divestiture package, while the number of merging firms increases with it. In spite of the required asset sale, parties' profitability remains ensured in most cases. Buyers always make profit from their purchase if industry fixed costs are rather low. We also add the alternative of a second buyer and compare outcomes with both consumer and welfare standards. Furthermore, as many mergers lead to efficiency gains, we integrate specific cost synergies and show that the higher synergies, the smaller the divestiture share. In the case when no buyers are available, we show that the option of divesting to a start-up entity is bound to fail if firms' technology remains the same. Lastly, we find that product differentiation can reduce the efficiency of the asset transfer.

From a methodological perspective, this paper aims to review the various means to assess a competition agency's merger decision. The upward trend to measure the efficiency of competition policy shows the utility of a survey about the main existing quantitative tools. To this end, four different approaches are exposed: simulation with structural models, event studies, the difference-in-difference technique, and lastly, surveys. One can ask if these tools often used during an investigation phase for a merger proposal can be transposed for a retrospective study. The pros and cons of such models are emphasized so that complementarities among them are possible., Selon une perspective méthodologique, cet article présente les différents moyens d'évaluer une décision de concentration rendue par l'autorité de concurrence. La tendance croissante à mesurer l'efficacité de la politique de concurrence nécessite un point de synthèse des principaux outils existants. Quatre techniques envisageables sont exposées à cette fin : la simulation à l'aide de modèles structurels, l'analyse événementielle des cours boursiers, la méthode des doubles différences et, enfin, les enquêtes et tests de marché. Nous nous demandons dans quelle mesure ces outils habituellement utilisés lors d'une notification de concentration peuvent être transposés pour une étude rétrospective. Les intérêts et limites de chaque approche sont successivement relevés pour souligner leur possible complémentarité.

En France, la récente affaire de l’eau semble sonner le glas du contrôle a posteriori des concentrations. L’objectif de cet article est de souligner pourtant l’intérêt de ce type de contrôle en montrant son rôle crucial pour les autorités de concurrence comme complément du système actuel des notifications. En présentant les limites d’un contrôle exclusivement ex-ante, nous montrons que la possibilité d’agir ex-post sur les structures du marché pourrait engendrer des comportements plus vertueux dans le contrôle amont en réduisant les effets de sélection adverse. Le contrôle a posteriori permettrait également une action positive sur les comportements des acteurs une fois la fusion réalisée, qu’il s’agisse des stratégies des firmes ou des nouvelles possibilités offertes aux autorités en matière d’incitations comportementales. Malgré ces effets favorables, la mise en œuvre d’un contrôle a posteriori des concentrations doit être abordée avec précaution car se poseraient en particulier des problèmes de sécurité juridique. Ces derniers pourraient cependant être compensés par une affirmation de la compétence du Conseil de la concurrence en matière de concentration. A recent French merger case involving two large water companies seems to toll the death of ex-post merger control. This paper aims at highlighting the interest of that type of control by showing its crucial role for competition authorities as a complement of the current notification system. Stressing the limits of an exclusively ex-ante control, we show that the possibility to act ex-post on market structures would lead to more virtuous behaviors in the ex-ante control by reducing adverse selection effects. The ex-post merger control would also permit new means of action on agents’ behaviors after the merger. Despite those positive effects, the implementation of an ex-post merger control should be attentively carried out in particular because some legal security problems could emerge. However, those issues might be offset by increasing the competence of the French competition authority in merger cases.

Évaluation SMART - auteur hors Unité au moment de la publication; International audience; This paper aims to build and empirically evaluate a discrete choice model of merger remedies as a basis for policy analysis. The database consists of 229 merger cases accepted in Phase I or Phase II of the European merger process between 1990 and 2005. We focus on the following question: Which merging firms’ characteristics lead the European Commission to decide whether to require conditional acceptance? Although a lot of empirical studies have been carried out these last years, ours is distinguished by at least two original features. First, we explore determinant factors of the Commission’s decisions with a neural network model differentiating cases accepted with or without remedies (either structural or behavioral). Secondly, we implement three multinomial logit models. We find that variables related to high market power lead more frequently to a remedy outcome, no matter the phase. Innovative industries such as energy, transportation and communications positively affect the probability of a behavioral remedy. Lastly, former Competition Commissioner Mario Monti’s policy appears to be pro-remedy, i.e. seeking concessions from merging parties.

This paper aims to build and empirically evaluate a discrete choice model of merger remedies as a basis for policy analysis. The database consists of 229 merger cases accepted in Phase I or Phase II of the European merger process between 1990 and 2005. We focus on the following question: Which merging firms’ characteristics lead the European Commission to decide whether to require conditional acceptance? Although a lot of empirical studies have been carried out these last years, ours is distinguished by at least two original features. First, we explore determinanting factors of the Commission’s decisions with a neural network model differentiating cases accepted with or without remedies (either structural or behavioral). Secondly, we implement three multinomial logit models. We find that variables related to high market power lead more frequently to a remedy outcome, whatever the phase. Innovative industries such as energy, transportation and communications positively affect the probability of a behavioral remedy. Lastly, former Competition Commissioner Mario Monti’s policy appears to be pro-remedy, i.e. seeking concessions from merging parties.

A recent French merger case involving two large water companies seems to toll the death of ex-post merger control. This paper aims at highlighting the interest of that type of control by showing its crucial role for competition authorities as a complement of the current notification system. Stressing the limits of an exclusively ex-ante control, we show that the possibility to act ex-post on market structures would lead to more virtuous behaviors in the ex-ante control by reducing adverse selection effects. The ex-post merger control would also permit new means of action on agents’ behaviors after the merger. Despite those positive effects, the implementation of an ex-post merger control should be attentively carried out in particular because some legal security problems could emerge. However, those issues might be offset by increasing the competence of the French competition authority in merger cases.

A recent French merger case involving two large water companies seems to toll the death of ex-post merger control. This paper aims at highlighting the interest of that type of control by showing its crucial role for competition authorities as a complement of the current notification system. Stressing the limits of an exclusively ex-ante control, we show that the possibility to act ex-post on market structures would lead to more virtuous behaviors in the ex-ante control by reducing adverse selection effects. The ex-post merger control would also permit new means of action on agents’ behaviors after the merger. Despite those positive effects, the implementation of an ex-post merger control should be attentively carried out in particular because some legal security problems could emerge. However, those issues might be offset by increasing the competence of the French competition authority in merger cases.

International audience