My research interests are mainly topics in industrial economics and competition policy (in particular, vertical relationships, two-sided markets, the payment card industry, contract theory, and antitrust issues related to buyer power). In addition to research, I am very ambitious about teaching. I worked as a teaching assistant of undergraduate courses, like Game Theory, Econometrics, Microeconomics, Public Finance, as well as a graduate course in Advanced Microeconomics. I am ready to teach Microeconomics, Industrial Organization, Game Theory, Contract Theory PhD Thesis: "Essays on Theoretical Industrial Organization". Abstract: This doctoral thesis contributes mainly to three topics in theoretical industrial organization and competition policy. The first chapter focuses on a payment card association, like Visa, and analyzes the determinants of the interchange fee paid by the merchant's bank to the cardholder's bank for every card transaction. It illustrates a distortion of card user fees due a too high IF set by the card association. It explains how the fact that cardholders decide on card usage, whereas an affiliated merchant cannot affect card usage, results in this inefficiency. Second chapter develops a vertical contracting framework of sequential bilateral negotiations between one monopoly manufacturer and two competing retailers. It shows how renegotiation clauses and negative upfront fees (i.e., slotting fees) of supply contracts enable the firms to internalize contracting externalities and implement the fully integrated monopoly outcome. The third chapter analyzes the sources and welfare implications of retailers' buyer power while introducing widely used non-linear supply contracts in the analysis. It outlines conditions under which a profitable buyer merger between outlets active in different markets would raise consumer prices and affect the profits of other retailers. Whether the merging outlets are from symmetric retail markets, if not, the type of retail competition are found to be the key determinants of how the buyer merger affects consumer prices and other retailers."Pricing Payment Cards", with Dr. Emilio Calvano. Abstract: In a payment card association such as Visa, each time a consumer pays by card, the bank of the merchant (acquirer) pays an interchange fee (IF) to the bank of the cardholder (issuer) to carry out the transaction. This paper studies the determinants of socially and privately optimal IFs in a card scheme where services are provided by a monopoly issuer and perfectly competitive acquirers to heterogeneous consumers and merchants. Different from the literature, we distinguish card membership from card usage decisions (and fees). In doing so, we reveal the implications of an asymmetry between consumers and merchants: the card usage decision at a point of sale is delegated to cardholders since merchants are not allowed to turn down cards once they are affiliated with a card network. We show that this asymmetry is sufficient to induce the card association to set a higher IF than the socially optimal IF, and thus to distort the structure of user fees by leading to too low card usage fees at the expense of too high merchant fees. Hence, cap regulations on IFs can improve the welfare. These qualitative results are robust to imperfect issuer competition and to other factors affecting final demands, such as elastic consumer participation or strategic card acceptance to attract consumers. Abstract: This paper develops a framework of sequential bilateral negotiations on supply contracts between one monopoly manufacturer and two competing retailers, where the parties have balanced and differentiated bargaining power. In this setup, multi-part supply contracts usually do not suffice to coordinate pricing decisions of competing retailers, i.e., to implement the fully integrated monopoly outcome since the manufacturer and the first negotiating retailer may deviate from the monopoly price to get a larger share of a smaller pie. I show that supply contracts including negative upfront payments (i.e., slotting fees paid by the manufacturer to the retailer) combined with quantity discounts, e.g., two-part tariffs conditional on the purchase of a positive quantity, yield the monopoly outcome in every equilibrium of two contracting environments: when the contract signed with the first retailer is no longer valid and renegotiated if there is a disagreement with the second retailer and when contracts involve exclusive dealing provisions. I thereby show that renegotiation clauses of supply contracts could be an alternative to exclusive dealing provisions in order to eliminate downstream competition. The parties' bargaining power only affects the sharing of the monopoly profits. In particular, in contrast to the results of Marx and Shaffer (2008), slotting allowances do not lead here to the exclusion of a retailer, but are in fact the means to obtain common agency, where both retailers are active. "Inefficient Buyer Mergers To Obtain Size Discounts", with Dr. Stéphane Caprice.
Abstract: This paper analyzes the welfare implications of buyer mergers and buyer power focusing on non-linear supply contracts negotiated bilaterally between one monopoly manufacturer and many locally competitive retailers. As in Chipty and Snyder (1999), a larger buyer gets size discounts from the manufacturer which has convex costs, i.e., it has a higher buyer power than smaller retailers. Contrary to the conventional argument that more buyer power reduces retail prices, we show that the larger retailer does not pass on size discounts to consumer prices. Moreover, size discounts for the larger buyer do not lead to higher tariffs for smaller buyers, i.e., there is no waterbed effect. We next illustrate that size discounts might result in inefficient buyer mergers decreasing the consumer surplus. This is found to be the case when independent stores want to merge to improve their bargaining power vis-à-vis the supplier, and thus get size discounts, even if the merger deteriorates their downstream efficiency. For policy concerns, we show that inefficient buyer mergers are more likely to occur when retail competition is weaker, for instance, due to strict commercial zoning rules.
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