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The Risk of Marginal Ranking: A Replication and Extension of Lewis & Carlos (2023)
No full textConventional wisdom suggests that being included in an exclusive ranking leads to positive external evaluations. However, Lewis and Carlos (2023) found that firms situated near the threshold for inclusion on the 100 Best Corporate Citizen ranking were devalued by investors. To assess the generalizability of this surprising finding, we quasi-replicate and extend this finding by applying the same regression discontinuity design to the Fortune 500 ranking. We find corroborating evidence: firms near the bottom of the Fortune 500 receive lower external evaluations, not only from investors but also from industry peers. Our findings therefore quasi-replicate and extend Lewis and Carlos’ (2023) results by showing that negative reactions to marginal ranking are not limited to investors or to a single ranking context
Capital Allocation Concentration Measurement in Venture Capital
No full textWe revisit the measurement of capital allocation concentration in the venture capital (VC) industry and highlight the shortcomings of the widely used Herfindahl-Hirschman Index (HHI). We show that HHI-based concentration measures are sensitive to discrepancies in VC database coverage, industry taxonomies, and classification granularity, yielding divergent trends even when applied to identical VC portfolios. To overcome these limitations, we develop a novel concentration metric using large language model (LLM) text embeddings that capture the semantic similarity among financed startups beyond predefined industry classifications. Using matched PitchBook and Crunchbase data, we validate our approach and show that OpenAI embeddings outperform alternative models on signal-to-noise and retrieval tasks. Applying this methodology, we document that aggregate VC capital allocation concentration has increased more sharply than suggested by HHI measures. A novel decomposition shows that 40% of the growth in capital allocation concentration stems from an increase in within-sector similarity among founded startups—an effect that industry-based measures do not capture
Household Beliefs about Fiscal Dominance
No full textWe study beliefs about fiscal dominance in a survey of German households. We first use a randomized controlled trial to identify how fiscal news impact individual debt-to-GDP and inflation expectations. We document that the link between debt and inflation crucially depends on individuals’ views about the fiscal space. News leading individuals to expect higher debt-to-GDP ratios make them more likely to revise upward their inflation expectations. These average effects are due to individuals who think that fiscal resources are more stretched than others. In contrast, individuals who think there is fiscal space do not associate debt with inflation. We then rationalize these results in a New Keynesian model where agents have heterogeneous beliefs about the fiscal space. We show that the heterogeneity of beliefs implies a policy tradeoff for the central bank. Agents who expect fiscal dominance in the future exert upward pressure on inflation. An active central bank may choose to partially tolerate this higher inflation due to the real costs of completely stabilizing prices
Power of Waste-Aware Display Policies in Online Grocery Retail: A Unified Framework
No full textWith online grocery shopping rapidly becoming the norm, retailers are increasingly focused on boosting demand through optimizing product displays, specifically assortment and ranking decisions. This, however, poses several intertwined challenges, such as coordinating assortment-ranking-inventory decisions, tailoring product displays to evolving inventory, and managing quality decay across products of varying ages. Beyond these operational complexities, sustainability pressures are mounting, as policymakers push retailers to curb food waste and improve societal outcomes. In this paper, we propose a unified inventory-adaptive framework for online grocery shopping that explicitly captures these operational and environmental interdependencies. (i) We introduce a novel fluid reformulation which, although not directly equivalent to the original deterministic problem, can be systematically transformed, via a series of transformations, to recover the true optimal policy of the original deterministic formulation. (ii) We show that the fluid solution is asymptotically optimal in the stochastic system. (iii) Our proposed algorithm is computationally scalable and operationally stable (a) requiring only minimal daily adjustments to maintain a smooth shopping experience, (b) ensuring nearly uniform display lengths for consistent online operations, and (c) recovering the optimal solution in polynomial time with respect to the number of products. (iv) A full welfare analysis comparing firm profit, waste and customer surplus across different policy regimes (waste ban vs. no ban) and operational strategies (static vs. adaptive), shows that our adaptive display policies outperform static policies across all dimensions: higher profit, lower waste, and greater customer surplus, providing a win-win-win framework, a rare outcome in public policy design where trade-offs are typically inevitable. (v) Our numerical simulations further reveal that adaptive display policies can render the organic waste bans nearly redundant, or even counter-productive. In particular, with adaptive systems in place, bans yield negligible additional waste reduction while introducing inefficiencies (lower profits) or compliance burdens (increasing regulatory costs). Overall, this suggests that promoting internally adaptive policies, rather than rigid regulatory bans, can achieve superior outcomes in a more flexible, cost-effective, and scalable manner
Collusion through Common Leadership
No full textThis paper studies whether common leadership, defined as two firms sharing executives or board directors, contributes to collusion. Using an explicit measure of labor market collusion from unsealed court evidence, we find that the probability of collusion between two firms increases by 12 percentage points after the onset of common leadership, compared to a baseline rate of 1.2 percent in the absence of common leaders. These results are not driven by closeness of product or labor market competition. Our findings are consistent with the increasing attention toward common leadership under Clayton Act Section 8
Public Participation Before the Court of Justice of the EU: Enhancing Outside Party Judicial Participation via Amicus Curiae Briefs
No full textPublic Participation Before the Court of Justice of the EU: Enhancing Outside Party Judicial Participation via Amicus Curiae Briefs This article assesses the participatory dimension of the EU judicial system against increasing demand for civil society’s participation before the Court of Justice of the European Union (CJEU). First, it explores the judicial participatory opportunity structure before the CJEU, that is the various legal remedies foreseen in the EU legal order. Second, it examines the realities of judicial practices open to both parties and third parties to a dispute by identifying the structural conditions preventing them from gaining access to the Court. It also documents the emergence of a new, informal practice of ‘shadow’ amicus curiae briefs aimed at countering limited outside third-party participation. Third, it assesses whether the extant CJEU’s opportunity structure available to outside parties to a dispute is in line with the Treaty-enshrined participatory imperative stemming from the principle of openness – Article 11 TEU (‘take into account citizens’ views) – that of equality – Article 9 TEU (‘equal attention to all stakeholders’) and Article 13 TEU (an institutional framework which serve citizens’ interests) – and that of participation under Article 10(3) TEU (‘Every citizen shall have the right to participate in the democratic life of the Union’), as they apply to the EU judicial system. Fourth, it argues that these principles require the CJEU to re-evaluate the current judicial framework to ensure that the EU judicial system appropriately addresses not only individual and societal interests when those are parties to a dispute but also when, albeit equally affected, they find themselves outside of it. Ultimately, it demonstrates that the practice of amicus curiae briefs may provide a suitable means to not only compensate for the for limited standing – including in third-party interventions – but also to broaden the Court’s access to the dispersed and untapped expertise and greater civil society participation in court proceedings, thus legitimising the CJEU’s output and throughput
The EU Interinstitutional Body for Ethical Standards: A Legal and Policy Analysis
No full textAmid several high-profile ethical scandals, the EU has been discussing since the early 2000s the establishment of a dedicated EU ethics authority capable of restoring trust in the operation of its institutions. This article provides one of the first assessments of the newly adopted EU Interinstitutional Body for Ethical Standards by examining whether and how it can strengthen the existing EU public integrity system. After tracing its genesis and evolution, it first identifies the major structural limitations of the extant EU ethical framework, ranging from its high fragmentation within and across EU institutions, weak enforcement of its underlying standards to its limited awareness within the EU institutional setting and wider public. Second, it assesses whether the newly adopted EU ethical body may address and overcome those structural limitations and how it may do so. It concludes that, despite its limited authority – both in terms of investigative and sanctioning powers – the first dedicated Interinstitutional Body for Ethical Standards carries the potential to mark a qualitative difference in developing the EU public integrity system as we know it. Through a combination of its standard-setting, advisory and awareness-raising functions, the Body may profoundly alter both the ethical standards and their enforcement for participating institutions’ members and beyond
Pricing and Assortment Optimization under an MNL Model with Default Specific Consideration
No full textProblem definition: Customers tend to consider products that are familiar and comfortable to choose. This phenomenon is commonly referred to as the default effect, recognized among the most robust phenomena in economics and cognitive psychology. In this paper, we consider the Multinomial Logit (MNL) model with the so-called "Default Specific Consideration'' (DSC), one of the most widely studied classes of choice models in economics that captures the default effect, which we will simply label as the DSC model for brevity. The DSC model can be viewed as a two-stage choice model where, in the first stage, the customer only considers her default option, and purchases it if its utility dominates that of the no-purchase option. Otherwise, the customer may move on to the second stage, where she chooses from all the available products. Moreover, the DSC model accounts for customer heterogeneity, as different individuals may have different default products. We consider both the pure pricing and pure assortment problems under the DSC model. Methodology/results: In the pure pricing setting, we find that the renowned same-price (or same-markup) policy is no longer optimal. Interestingly, however, we show that a variant of this policy continues to hold, where non-default products admit the same-price (or same-markup) policy whereas, for the default products, their prices can all be different from each other. Finding the optimal policy is still computationally expensive as the set of default products can potentially be large and the expected revenue function is not well-behaved. Thus, we develop a polynomial-time approximation algorithm that provides a (1-\epsilon)-optimal solution. In the pure assortment setting, we show that the so-called revenue-ordered property no longer holds. However, there exists an optimal policy where the non-default products continue to follow the revenue-ordered property, while the default products may deviate from this property. This introduces a more intricate structure, allowing default products to be included even if they do not conform to the revenue-ordered principle. We design a different polynomial-time approximation algorithm that ensures a (1 - \epsilon)-optimal solution. Managerial implications: Our analysis shows that disregarding the default effect can result in highly sub-optimal pricing and assortment policies, highlighting the profound impact of default effects on operational decisions in retail. Incorporating the default effect, we show numerically that our proposed algorithm can significantly improve a retailer's expected total revenues
Dans la famille « culture et médias », la grande sœur souriante, passionnée et décalée…
No full textInternational audienc
Plateformisation et contenus : Quelques leçons tirées de conflits récents
No full textInternational audienceDans les deux dernières décennies, toutes les industries de contenus, la vidéo, la musique ou la presse ont fait face aux bouleversements du numérique, qui se sont traduits par une évolution des usages et le poids croissant des plateformes. Dans le contexte de la musique ou de l’audiovisuel, le poids dominant des GAFAM n’a pas empêché l’émergence de nouveaux acteurs puissants comme Spotify ou Netflix, s’appuyant sur l’innovation sur les usages de consommation pour construire une position forte. La transformation des modes d’intermédiation donne en effet une place grandissante à des plateformes d’agrégation qui se sont imposées dans un contexte d’hyperoffre, laquelle structure une nouvelle manière de créer de la valeur par les contenus. L’opérationnalisation et la prise en compte, dans la régulation, des modèles de prescription et des marchés multifaces remet forcément en cause les approches sectorielles traditionnelles du fait des multiples possibilités ouvertes pour organiser, décomposer et construire différemment les structures de prix entre les différentes faces de marchés. Plusieurs évolutions récentes, en France et à l'étranger, illustrent de manière intéressante les incertitudes stratégiques des acteurs face à de telles évolutions ainsi que les difficultés de définir des régulations adaptées