1999 – Hannover

Jahrestagung des Industrieökonomischen Ausschusses, 8.–9. März 1999

Die Sitzung fand vom 8.-9.  März 1999 in Hannover statt. Die lokale Organisation haben die Kollegen Müller und von der Schulenburg übernommen. Es wurden folgende Referate gehalten:

  • Engelbert Dockner, "Horizontal Mergers in Dynamic Markets"

The consequences of horizontal mergers on firms' profits are traditionally studied within a static Cournot framework. In such a setting the merger is modelled as an exogeneous change in market structure. One of the key results in this literature is that if firms compete in a homogeneous product market, mergers will in general be unprofitable: the insiders to the merger will gain less than the outsiders do. In this paper we analyze horizontal mergers of firms that compete in a dynamic Cournot market. We find unlike in static Cournot models that mergers are always profitableindependent of the number of merging firms and of the parameterization of the cost structure of the firms. Hence we argue that the likelihood of merger is higher in industries with dynamic rather than static competition.

  • Monika Schnitzer, "Bank Competition and Enterprise Restructuring in Transition Economies"

We investigate how bank competition affects the efficiency of credit allocation, using a model of spatial competition. Our analysis shows that bad loans are more likely the larger the number of banks competing for customers. We study further how many banks will be active if market entry is not regulated. Free entry can induce too much entry and thus too many bad loans compared to the social optimum. Finally, we analyze how bank competition affects the firms' restructuring effort. We find that restructuring has positive externalities which give rise to multiple equilibria, with either much or little restructuring activity.

  • Helmut Zink, "Das Risiko von Finanzmarktkrisen und sein Einfluß auf das Kreditvergabeverhalten von Banken"

Es wird diskutiert, wie Banken mit modernen Methoden des Kreditrisikomanagements auf das Risiko von Finanzmarktkrisen reagieren. Behandelt wird die Einschätzung der Wahrscheinlichkeiten von Krisen, die Abschätzung von Verlusten und vorzuhaltenen Reserven, und der Einfluss dieser Risiken auf die interne Kapitalallokation der Banken. Daneben wird auf die Ursachen von Finanzmarktkrisen und auf aktuelle Regulierungsvorschläge eingegangen.

  • Jürgen Weigand, "Does Science Make a Difference? Investment, Finance and Corporate Governance in German Industries"

The purpose of this paper is to examine the impact of industry knowledge conditions and corporate governance structures on tangible investment and its financing. Based on a large panel data set of German firms we investigate whether liquidity constraints vary systematically across firms engaged in activities reflecting very different knowledge conditions. In particular, we compare the extent of liquidity constraints in science-based firms with non science-based firms. This distinction is important because science-based firms generally fit the characteristics of market failure identified by Kenneth Arrow. Their economic activity is subject to high uncertainty, asymmetric knowledge and non-exclusiveness so liquidity constraints might be severe. Surprisingly, we find only weak evidence of liquidity constraints. Moreover, science seems to make a difference in that firms in science-based industries tend to be less constrained. However, governance structures play an important role. After distinguishing between manager-controlled and owner-controlled firms we observe that the owner-controlled firms are significantly more liquidity constrained both in science-based and non science-based industries. But the industry knowledge conditions make the difference. Liquidity constraints are more pronounced for the owner-controlled firms in non science-based industries.

  • Joachim Wagner, "The Life History of Cohorts of Exits from German Manufacturing"

An investigation of the life history of three cohorts of exits based on longitudinal data covering the population of all manufacturing firms in a German federal state reveals three empirical regularities: (1) Although the probalility of exit tends to decline with age ceteris paribus, only about a quarter of all exits is from the group of young firms aged five years or less. (2) Only a minor fraction of exits lived through a period of continous decline of employment for five years or more before closing down. (3) The ,impact effect' of job loss due to exits is about equal to the ,long run effects'.

  • Mathias Erlei, "Conscious Parallelism by Fixed Relative Prices"

This paper is about conscious parallelism in a duopoly with differentiated products. Conscious parallelism is modelled by a "policy of fixed relative prices", i.e. starting from a competitive equilibrium both duopolists vary prices by the same percentage. Such a simple and symmetric adjustment process reaches a restpoint, the frp-equilibrium, that is characterized by remarkable properties: (1) in symmetric duopolies the frp-equilibrium reaches a first best solution (maximum of aggregate profits); (2) in stark contrast to "usual" collusive equilibria frp-equilibria are stable with regard to asymmetries in the underlying duopoly model. Finally, an analysis of the working mechanism gives an explanation of the model's stability properties."

  • Helmut Bester und Klaus Ritzberger, "Strategic Pricing, Signaling, and Costly Information Acquisition"

Consider a market where an informed monopolist sets the price for a good or asset with a value unknown to potential buyers. Upon observing the price, buyers may pay some cost for information about the value before deciding on purchases. To restrict buyer beliefs we generalize the idea of the Cho-Kreps "intuitive criterion." Then there is no separating equilibrium with fully revealing prices. Yet, as the cost of information acquisition becomes small, the equilibrium approaches the full information outcome and prices become perfectly revealing.