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Papers by Jorge Padilla

Research paper thumbnail of On the Private and Social Value of Consumer Data in Vertically-Integrated Platform Markets

SSRN Electronic Journal, 2020

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Research paper thumbnail of The Law and Economics of Article 102 TFEU

1. INTRODUCTION, SCOPE OF APPLICATION, AND BASIC FRAMEWORK 1.1 INTRODUCTION 1.2 OBJECTIVES OF ART... more 1. INTRODUCTION, SCOPE OF APPLICATION, AND BASIC FRAMEWORK 1.1 INTRODUCTION 1.2 OBJECTIVES OF ARTICLE 102 TFEU 1.3 SCOPE OF APPLICATION OF ARTICLE 102 TFEU 1.4 RELATIONSHIP BETWEEN ARTICLE 102 TFEU AND OTHER LEGAL INSTRUMENTS 2. HISTORY, DEVELOPMENT, AND REFORM 2.1 INTRODUCTION 2.2 HISTORY OF ARTICLE 102 TFEU 2.3 DEVELOPMENT OF ARTICLE 102 TFEU 2.4 THE REFORM OF ARTICLE 102 TFEU 3. MARKET DEFINITION 3.1 INTRODUCTION 3.2 PRODUCT MARKET DEFINITION: BASIC CONCEPTS 3.3 RELEVANT PRODUCT MARKETS: FROM THEORY TO PRACTICE 3.4 GEOGRAPHIC MARKET DEFINITION 3.5 SELECTED ISSUES ON MARKET DEFINITION 4. DOMINANCE 4.1 INTRODUCTION 4.2 SINGLE FIRM DOMINANCE 4.3 COLLECTIVE DOMINANCE 4.4 DOMINANT BUYERS 4.5 "SUPERDOMINANCE" 4.6 COMPARING DOMINANCE UNDER ARTICLE 102 TFEU AND OTHER EU LEGISLATION 4.7 SUBSTANTIAL PART OF THE COMMON MARKET 5. THE GENERAL CONCEPT OF AN ABUSE 5.1 INTRODUCTION 5.2 THE ECONOMICS OF ABUSIVE UNILATERAL CONDUCT 5.3 THE CATEGORIES OF ABUSE UNDER ARTICLE 102 TFEU 5.4 ANTICOMPETITIVE EFFECTS UNDER ARTICLE 102 TFEU 5.5 OBJECTIVE JUSTIFICATION 6. PREDATORY PRICING 6.1 INTRODUCTION 6.2 THE ECONOMICS OF PREDATORY PRICING 6.3 THE BASIC RULES ON BELOW-COST PRICE CUTTING UNDER ARTICLE 102 TFEU 6.4 SPECIFIC ISSUES WITH BELOW-COST PRICING UNDER ARTICLE 102 TFEU 6.5 EXCLUSIONARY ABOVE-COST PRICE CUTS UNDER ARTICLE 102 TFEU 6.6 OBJECTIVE JUSTIFICATION 7. MARGIN SQUEEZE 7.1 INTRODUCTION 7.2 THE ECONOMICS OF MARGIN SQUEEZE 7.3 MINIMUM LEGAL CONDITIONS FOR A MARGIN SQUEEZE 7.4 THE RELATIONSHIP BETWEEN MARGIN SQUEEZE AND OTHER ABUSES 7.5 DIFFICULTIES WITH IDENTIFYING AN ANTICOMPETITIVE MARGIN SQUEEZE IN PRACTICE 7.6 CONFLICTS BETWEEN REGULATION AND COMPETITION LAW IN MARGIN SQUEEZE CASES 8. EXCLUSIVE DEALING AND RELATED PRACTICES 8.1 INTRODUCTION 8.2 ECONOMICS OF EXCLUSIVE DEALING 8.3 EVOLUTION OF THE APPROACH TO EXCLUSIVE DEALING UNDER ARTICLE 102 TFEU 8.4 ASSESSMENT OF EXCLUSIVE DEALING UNDER ARTICLE 102 TFEU 8.5 OBJECTIVE JUSTIFICATION 8.6 PRACTICES FALLING SHORT OF OUTRIGHT EXCLUSIVITY 9. LOYALTY REBATES AND RELATED PRACTICES 9.1 INTRODUCTION 9.2 ECONOMICS OF LOYALTY REBATES 9.3 ASSESSMENT OF LOYALTY REBATES UNDER ARTICLE 102 TFEU 9.4 ANTICOMPETITIVE EFFECTS IN REBATE CASES 9.5 OBJECTIVE JUSTIFICATION 10. REFUSAL TO DEAL 10.1 INTRODUCTION 10.2 THE ECONOMICS OF REFUSAL TO DEAL 10.3 THE DUTY TO DEAL WITH COMPETITORS 10.4 DUTY TO DEAL WITH CUSTOMERS UNDER ARTICLE 102 TFEU 11. TYING AND BUNDLING 11.1 INTRODUCTION 11.2 THE ECONOMICS OF TYING AND BUNDLING 11.3 TYING AND BUNDLING UNDER ARTICLE 102 TFEU 11.4 TYING IN AFTERMARKETS 11.5 MIXED BUNDLING 12. EXCLUSIONARY NON-PRICE ABUSES 12.1 INTRODUCTION 12.2 EXAMPLES OF EXCLUSIONARY NON-PRICE ABUSES 13. ABUSIVE CONDUCT AND STANDARDS 13.1 INTRODUCTION 13.2 THE MEANING OF FRAND TERMS 13.3 INJUNCTIVE RELIEF AND FRAND TERMS 13.4 DECEPTION/MISREPRESTATION 7 13.5 ABUSIVE ACQUISITION OR ACCUMULATION OF IPRs 14. EXCESSIVE PRICING 14.1 INTRODUCTION 14.2 THE ECONOMICS OF EXCESSIVE PRICING 14.3 THE LEGAL TEST(S) FOR EXCESSIVE PRICING 14.4 DIFFICULTIES WITH THE CURRENT APPROACH TO EXCESSIVE PRICING 14.5 ALTERNATIVE APPROACHES TO EXCESSIVE PRICING UNDER ARTICLE 102 TFEU 14.6 CONCLUSION 15. ABUSIVE DISCRIMINATION 15.1 INTRODUCTION 15.2 THE ECONOMICS OF PRICE DISCRIMINATION 15.3 LEGAL CONDITIONS FOR ABUSIVE DISCRIMINATION 15.4 EXAMPLES OF ABUSIVE DISCRIMINATION 15.5 OBJECTIVE JUSTIFICATION 16. OTHER EXPLOITATIVE ABUSES 16.1 INTRODUCTION 16.2 ABUSE OF MONOPSONY PURCHASING POWER 16.3 UNFAIR AND EXPLOITATIVE CONTRACT TERMS 17. EFFECT ON TRADE 17.1 INTRODUCTION 17.2 BASIC LEGAL CONDITIONS FOR EFFECT ON TRADE 17.3 SPECIFIC APPLICATIONS OF THE EFFECT ON TRADE CONCEPT 18. REMEDIES 18.1 INTRODUCTION 18.2 GENERAL PRINCIPLES GOVERNING REMEDIES 18.3 PRINCIPAL TYPES OF ADMINISTRATIVE DECISIONS 18.4 PRINCIPAL TYPES OF REMEDIES 18.5 PRIVATE LITIGATION AND REMEDIES

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Research paper thumbnail of Settling FRAND Disputes: Is Mandatory Arbitration a Reasonable and Non-Discriminatory Alternative?

SSRN Electronic Journal, 2013

ABSTRACT This paper reviews the recent proposal that SSOs amend their IPR policies to require SEP... more ABSTRACT This paper reviews the recent proposal that SSOs amend their IPR policies to require SEP owners and willing licensees to resolve disputes over licensing terms, particularly FRAND royalty rates, using mandatory, binding baseball-style (or “final offer”) arbitration. We first consider the fundamental underlying premise of the arbitration proposal - namely, that there are systemic problems relating to FRAND-based standardization and that current disputes are not being efficiently addressed. We find that mandatory baseball arbitration is a solution in search of a problem, will not necessarily afford “better” outcomes, and is more likely to lead to decisions that undermine the standardization process.

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Research paper thumbnail of Quantifying Horizontal Merger Efficiencies in Multi-Sided Markets : An Application to Stock Exchange Mergers-Note by Enrique Andreu and Jorge Padilla Hearing on Re-thinking the use of traditional antitrust enforcement tools in multi-sided markets 21-23 June 2017

Stock exchanges are platforms operating in multi-sided markets. Mergers between stock exchanges c... more Stock exchanges are platforms operating in multi-sided markets. Mergers between stock exchanges can produce significant efficiency benefits, some of which can accrue directly or indirectly to the users of the integrated exchange: intermediaries (brokers and dealers), final investors and issuers (listed companies). In particular, stock exchange integration can reduce the implicit costs of trading by increasing market liquidity. In this paper we investigate the liquidity implications of the integration of Euronext’s cash market. We find that the series of cash mergers that led to the creation of Euronext had a positive impact on liquidity – namely, on bid-ask spreads, volatility and traded volume. This exercise illustrates how past mergers can be used to assess empirically the potential efficiencies resulting from mergers between platforms operating in multi-sided markets.

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Research paper thumbnail of Charles River Associates

Formal, cooperative standard setting continues to grow in importance for the global economy. And ... more Formal, cooperative standard setting continues to grow in importance for the global economy. And as standards become more pervasive, the stakes rise for all participants. It is not surprising then that many standards are covered by intellec-tual property rights, that battles over the licensing of those rights have reached a fevered pitch in several industries, and that competition agencies around the globe are seriously weighing whether and how to intervene in the standard setting pro-cess. One suggestion for such an intervention is the imposition of a licensing cap, referred to as the incremental value rule. We evaluate this proposal and find that even in contexts where this rule is efficient from an ex-post point of view, it induces important distortions in the decisions of firms to innovate and participate in stan-dard setting organizations (SSO). Indeed, such a rule may increase the ”patent hold up ” problem that the licensing cap is aimed at preventing. Specifically, firms bein...

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Research paper thumbnail of Charles River Associates

Formal, cooperative standard setting continues to grow in importance for the global economy. And ... more Formal, cooperative standard setting continues to grow in importance for the global economy. And as standards become more pervasive, the stakes rise for all participants. It is not surprising then that many standards are covered by intellec-tual property rights, that battles over the licensing of those rights have reached a fevered pitch in several industries, and that competition agencies around the globe are seriously weighing whether and how to intervene in the standard setting pro-cess. One suggestion for such an intervention is the imposition of a licensing cap, referred to as the incremental value rule. We evaluate this proposal and find that even in contexts where this rule is efficient from an ex-post point of view, it induces important distortions in the decisions of firms to innovate and participate in stan-dard setting organizations (SSO). Indeed, such a rule may increase the ”patent hold up ” problem that the licensing cap is aimed at preventing. Specifically, firms bein...

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Research paper thumbnail of Information Exchanges Between Competitors under Competition Law

The OECD Competition Committee debated competition aspects of information exchanges between

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Research paper thumbnail of A Theory of Patent Holdout

This paper provides a framework to analyze patent holdout. We show that when patents are probabil... more This paper provides a framework to analyze patent holdout. We show that when patents are probabilistic, a potential user typically has incentives to shun to pay the price offered by a patent holder to license the technology and risk being brought to court. Litigation benefits the user because of its asymmetric effect, specially in the context of Standard Development Organizations (SDOs). While the user may not pay if the court decides that there has been no infringement, the price of the license will not adjust, accordingly, if the court considers that such an infringement exists. We show that this effect is exacerbated under sequential litigation across different jurisdictions or patents, where the outcome of one trial affects the probability in which a court sides with each of the parties in future ones. The incentives to engage in patent holdout as well as its distortions increase when final competition is accounted for. JEL codes: L15, L24, O31, O34. keywords: Intellectual Prope...

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Research paper thumbnail of Financial Intermediation Versus Stock Markets in a Dynamic Intertemporal Model

Journal of Institutional and Theoretical Economics-zeitschrift Fur Die Gesamte Staatswissenschaft, 1997

We consider the transitions among intragenerational and alternative intergenerational financing a... more We consider the transitions among intragenerational and alternative intergenerational financing and liquidity risk-sharing mechanisms, in an Overlapping Generations model with endogenous levels of long-lived investments. The existence and characterization of a Self-Sustaining Mechanism, stable across generations, are established. The long-run equilibrium outcome, in a Proposal Game across generations, is shown to depend on the risk-aversion and propensity for early liquidity needs of the agents.

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Research paper thumbnail of Does direct connect benefit travellers?

Economics Letters, 2020

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Research paper thumbnail of Access Conditions, Investment and Welfare

We investigate the relationship between investment in new infras-tructure by telecoms operators a... more We investigate the relationship between investment in new infras-tructure by telecoms operators and the access conditions to such in-frastructure. We consider two variations of the problem. In the first, there is one infrastructure company which invests in upgrading its net-work. A second non-infrastructure company needs to gain access to that infrastructure in order to offer the same higher quality services. We find that cost based access to the new infrastructure leads to a reduction in investment and also a fall in consumer welfare. In the second variation, both companies invest, either non-cooperatively or co-operatively (joint venture). We find that invest-ment and consumer welfare is higher than in the case that only one invests and is forced to give access at cost to the other. To clarify the effects, we show that after an investment has been carried out, e.g. for legacy assets, the best regulatory policy is to give access at cost. Once companies can carry out autonomous inve...

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Research paper thumbnail of DG Comp's Discussion Paper on Article 82: Implications of the Proposed Framework and Antitrust Rules for Dynamically Competitive Industries

SSRN Electronic Journal, 2006

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Research paper thumbnail of An Economic Take on Patent Licensing: Understanding the Implications of the 'First Sale Patent Exhaustion' Doctrine

SSRN Electronic Journal, 2010

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Research paper thumbnail of Preventing Patent Hold Up: An Economic Assessment of Ex Ante Licensing Negotiations in Standard Setting

SSRN Electronic Journal, 2008

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Research paper thumbnail of Collateral vs. Project Screening: A Model of Lazy Banks

SSRN Electronic Journal, 1998

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Research paper thumbnail of The Optimal Scope of the Royalty Base in Patent Licensing

SSRN Electronic Journal, 2014

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Research paper thumbnail of The Cost and Benefits of the Strict Protection of Creditor Rights: Theory and Evidence

SSRN Electronic Journal, 2000

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Research paper thumbnail of Royalty Stacking In High Tech Industries: Separating Myth From Reality

Working Papers, 2007

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Research paper thumbnail of The Ex Ante Auction Model for the Control of Market Power in Standard Setting Organizations

SSRN Electronic Journal, 2007

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Research paper thumbnail of Pricing Patents for Licensing in Standard Setting Organisations: Making Sense of FRAND Commitments

Entrepreneurship, 2007

We explore potential methods for assessing whether licensing terms for intellectual property decl... more We explore potential methods for assessing whether licensing terms for intellectual property declared essential within a standard setting organization can be considered fair, reasonable, and non-discriminatory (FRAND). We first consider extending Georgia-Pacific to a standard setting context. We then evaluate numeric proportionality, which is modelled after certain patent pool arrangements and which has been proposed in a pending FRAND antitrust suit. We then turn to two economic models with potential. The first—the efficient component-pricing rule (ECPR)—is based on the economic concept of market competition. The second—the Shapley value method—is based on cooperative game theory models and social concepts for a fair division of rents. Interestingly, these two distinct methods suggest a similar benchmark for evaluating FRAND licenses, but ones which might appeal differently to the courts and competition authorities in the US as compared to Europe. We find that under any approach, p...

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Research paper thumbnail of On the Private and Social Value of Consumer Data in Vertically-Integrated Platform Markets

SSRN Electronic Journal, 2020

Bookmarks Related papers MentionsView impact

Research paper thumbnail of The Law and Economics of Article 102 TFEU

1. INTRODUCTION, SCOPE OF APPLICATION, AND BASIC FRAMEWORK 1.1 INTRODUCTION 1.2 OBJECTIVES OF ART... more 1. INTRODUCTION, SCOPE OF APPLICATION, AND BASIC FRAMEWORK 1.1 INTRODUCTION 1.2 OBJECTIVES OF ARTICLE 102 TFEU 1.3 SCOPE OF APPLICATION OF ARTICLE 102 TFEU 1.4 RELATIONSHIP BETWEEN ARTICLE 102 TFEU AND OTHER LEGAL INSTRUMENTS 2. HISTORY, DEVELOPMENT, AND REFORM 2.1 INTRODUCTION 2.2 HISTORY OF ARTICLE 102 TFEU 2.3 DEVELOPMENT OF ARTICLE 102 TFEU 2.4 THE REFORM OF ARTICLE 102 TFEU 3. MARKET DEFINITION 3.1 INTRODUCTION 3.2 PRODUCT MARKET DEFINITION: BASIC CONCEPTS 3.3 RELEVANT PRODUCT MARKETS: FROM THEORY TO PRACTICE 3.4 GEOGRAPHIC MARKET DEFINITION 3.5 SELECTED ISSUES ON MARKET DEFINITION 4. DOMINANCE 4.1 INTRODUCTION 4.2 SINGLE FIRM DOMINANCE 4.3 COLLECTIVE DOMINANCE 4.4 DOMINANT BUYERS 4.5 "SUPERDOMINANCE" 4.6 COMPARING DOMINANCE UNDER ARTICLE 102 TFEU AND OTHER EU LEGISLATION 4.7 SUBSTANTIAL PART OF THE COMMON MARKET 5. THE GENERAL CONCEPT OF AN ABUSE 5.1 INTRODUCTION 5.2 THE ECONOMICS OF ABUSIVE UNILATERAL CONDUCT 5.3 THE CATEGORIES OF ABUSE UNDER ARTICLE 102 TFEU 5.4 ANTICOMPETITIVE EFFECTS UNDER ARTICLE 102 TFEU 5.5 OBJECTIVE JUSTIFICATION 6. PREDATORY PRICING 6.1 INTRODUCTION 6.2 THE ECONOMICS OF PREDATORY PRICING 6.3 THE BASIC RULES ON BELOW-COST PRICE CUTTING UNDER ARTICLE 102 TFEU 6.4 SPECIFIC ISSUES WITH BELOW-COST PRICING UNDER ARTICLE 102 TFEU 6.5 EXCLUSIONARY ABOVE-COST PRICE CUTS UNDER ARTICLE 102 TFEU 6.6 OBJECTIVE JUSTIFICATION 7. MARGIN SQUEEZE 7.1 INTRODUCTION 7.2 THE ECONOMICS OF MARGIN SQUEEZE 7.3 MINIMUM LEGAL CONDITIONS FOR A MARGIN SQUEEZE 7.4 THE RELATIONSHIP BETWEEN MARGIN SQUEEZE AND OTHER ABUSES 7.5 DIFFICULTIES WITH IDENTIFYING AN ANTICOMPETITIVE MARGIN SQUEEZE IN PRACTICE 7.6 CONFLICTS BETWEEN REGULATION AND COMPETITION LAW IN MARGIN SQUEEZE CASES 8. EXCLUSIVE DEALING AND RELATED PRACTICES 8.1 INTRODUCTION 8.2 ECONOMICS OF EXCLUSIVE DEALING 8.3 EVOLUTION OF THE APPROACH TO EXCLUSIVE DEALING UNDER ARTICLE 102 TFEU 8.4 ASSESSMENT OF EXCLUSIVE DEALING UNDER ARTICLE 102 TFEU 8.5 OBJECTIVE JUSTIFICATION 8.6 PRACTICES FALLING SHORT OF OUTRIGHT EXCLUSIVITY 9. LOYALTY REBATES AND RELATED PRACTICES 9.1 INTRODUCTION 9.2 ECONOMICS OF LOYALTY REBATES 9.3 ASSESSMENT OF LOYALTY REBATES UNDER ARTICLE 102 TFEU 9.4 ANTICOMPETITIVE EFFECTS IN REBATE CASES 9.5 OBJECTIVE JUSTIFICATION 10. REFUSAL TO DEAL 10.1 INTRODUCTION 10.2 THE ECONOMICS OF REFUSAL TO DEAL 10.3 THE DUTY TO DEAL WITH COMPETITORS 10.4 DUTY TO DEAL WITH CUSTOMERS UNDER ARTICLE 102 TFEU 11. TYING AND BUNDLING 11.1 INTRODUCTION 11.2 THE ECONOMICS OF TYING AND BUNDLING 11.3 TYING AND BUNDLING UNDER ARTICLE 102 TFEU 11.4 TYING IN AFTERMARKETS 11.5 MIXED BUNDLING 12. EXCLUSIONARY NON-PRICE ABUSES 12.1 INTRODUCTION 12.2 EXAMPLES OF EXCLUSIONARY NON-PRICE ABUSES 13. ABUSIVE CONDUCT AND STANDARDS 13.1 INTRODUCTION 13.2 THE MEANING OF FRAND TERMS 13.3 INJUNCTIVE RELIEF AND FRAND TERMS 13.4 DECEPTION/MISREPRESTATION 7 13.5 ABUSIVE ACQUISITION OR ACCUMULATION OF IPRs 14. EXCESSIVE PRICING 14.1 INTRODUCTION 14.2 THE ECONOMICS OF EXCESSIVE PRICING 14.3 THE LEGAL TEST(S) FOR EXCESSIVE PRICING 14.4 DIFFICULTIES WITH THE CURRENT APPROACH TO EXCESSIVE PRICING 14.5 ALTERNATIVE APPROACHES TO EXCESSIVE PRICING UNDER ARTICLE 102 TFEU 14.6 CONCLUSION 15. ABUSIVE DISCRIMINATION 15.1 INTRODUCTION 15.2 THE ECONOMICS OF PRICE DISCRIMINATION 15.3 LEGAL CONDITIONS FOR ABUSIVE DISCRIMINATION 15.4 EXAMPLES OF ABUSIVE DISCRIMINATION 15.5 OBJECTIVE JUSTIFICATION 16. OTHER EXPLOITATIVE ABUSES 16.1 INTRODUCTION 16.2 ABUSE OF MONOPSONY PURCHASING POWER 16.3 UNFAIR AND EXPLOITATIVE CONTRACT TERMS 17. EFFECT ON TRADE 17.1 INTRODUCTION 17.2 BASIC LEGAL CONDITIONS FOR EFFECT ON TRADE 17.3 SPECIFIC APPLICATIONS OF THE EFFECT ON TRADE CONCEPT 18. REMEDIES 18.1 INTRODUCTION 18.2 GENERAL PRINCIPLES GOVERNING REMEDIES 18.3 PRINCIPAL TYPES OF ADMINISTRATIVE DECISIONS 18.4 PRINCIPAL TYPES OF REMEDIES 18.5 PRIVATE LITIGATION AND REMEDIES

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Research paper thumbnail of Settling FRAND Disputes: Is Mandatory Arbitration a Reasonable and Non-Discriminatory Alternative?

SSRN Electronic Journal, 2013

ABSTRACT This paper reviews the recent proposal that SSOs amend their IPR policies to require SEP... more ABSTRACT This paper reviews the recent proposal that SSOs amend their IPR policies to require SEP owners and willing licensees to resolve disputes over licensing terms, particularly FRAND royalty rates, using mandatory, binding baseball-style (or “final offer”) arbitration. We first consider the fundamental underlying premise of the arbitration proposal - namely, that there are systemic problems relating to FRAND-based standardization and that current disputes are not being efficiently addressed. We find that mandatory baseball arbitration is a solution in search of a problem, will not necessarily afford “better” outcomes, and is more likely to lead to decisions that undermine the standardization process.

Bookmarks Related papers MentionsView impact

Research paper thumbnail of Quantifying Horizontal Merger Efficiencies in Multi-Sided Markets : An Application to Stock Exchange Mergers-Note by Enrique Andreu and Jorge Padilla Hearing on Re-thinking the use of traditional antitrust enforcement tools in multi-sided markets 21-23 June 2017

Stock exchanges are platforms operating in multi-sided markets. Mergers between stock exchanges c... more Stock exchanges are platforms operating in multi-sided markets. Mergers between stock exchanges can produce significant efficiency benefits, some of which can accrue directly or indirectly to the users of the integrated exchange: intermediaries (brokers and dealers), final investors and issuers (listed companies). In particular, stock exchange integration can reduce the implicit costs of trading by increasing market liquidity. In this paper we investigate the liquidity implications of the integration of Euronext’s cash market. We find that the series of cash mergers that led to the creation of Euronext had a positive impact on liquidity – namely, on bid-ask spreads, volatility and traded volume. This exercise illustrates how past mergers can be used to assess empirically the potential efficiencies resulting from mergers between platforms operating in multi-sided markets.

Bookmarks Related papers MentionsView impact

Research paper thumbnail of Charles River Associates

Formal, cooperative standard setting continues to grow in importance for the global economy. And ... more Formal, cooperative standard setting continues to grow in importance for the global economy. And as standards become more pervasive, the stakes rise for all participants. It is not surprising then that many standards are covered by intellec-tual property rights, that battles over the licensing of those rights have reached a fevered pitch in several industries, and that competition agencies around the globe are seriously weighing whether and how to intervene in the standard setting pro-cess. One suggestion for such an intervention is the imposition of a licensing cap, referred to as the incremental value rule. We evaluate this proposal and find that even in contexts where this rule is efficient from an ex-post point of view, it induces important distortions in the decisions of firms to innovate and participate in stan-dard setting organizations (SSO). Indeed, such a rule may increase the ”patent hold up ” problem that the licensing cap is aimed at preventing. Specifically, firms bein...

Bookmarks Related papers MentionsView impact

Research paper thumbnail of Charles River Associates

Formal, cooperative standard setting continues to grow in importance for the global economy. And ... more Formal, cooperative standard setting continues to grow in importance for the global economy. And as standards become more pervasive, the stakes rise for all participants. It is not surprising then that many standards are covered by intellec-tual property rights, that battles over the licensing of those rights have reached a fevered pitch in several industries, and that competition agencies around the globe are seriously weighing whether and how to intervene in the standard setting pro-cess. One suggestion for such an intervention is the imposition of a licensing cap, referred to as the incremental value rule. We evaluate this proposal and find that even in contexts where this rule is efficient from an ex-post point of view, it induces important distortions in the decisions of firms to innovate and participate in stan-dard setting organizations (SSO). Indeed, such a rule may increase the ”patent hold up ” problem that the licensing cap is aimed at preventing. Specifically, firms bein...

Bookmarks Related papers MentionsView impact

Research paper thumbnail of Information Exchanges Between Competitors under Competition Law

The OECD Competition Committee debated competition aspects of information exchanges between

Bookmarks Related papers MentionsView impact

Research paper thumbnail of A Theory of Patent Holdout

This paper provides a framework to analyze patent holdout. We show that when patents are probabil... more This paper provides a framework to analyze patent holdout. We show that when patents are probabilistic, a potential user typically has incentives to shun to pay the price offered by a patent holder to license the technology and risk being brought to court. Litigation benefits the user because of its asymmetric effect, specially in the context of Standard Development Organizations (SDOs). While the user may not pay if the court decides that there has been no infringement, the price of the license will not adjust, accordingly, if the court considers that such an infringement exists. We show that this effect is exacerbated under sequential litigation across different jurisdictions or patents, where the outcome of one trial affects the probability in which a court sides with each of the parties in future ones. The incentives to engage in patent holdout as well as its distortions increase when final competition is accounted for. JEL codes: L15, L24, O31, O34. keywords: Intellectual Prope...

Bookmarks Related papers MentionsView impact

Research paper thumbnail of Financial Intermediation Versus Stock Markets in a Dynamic Intertemporal Model

Journal of Institutional and Theoretical Economics-zeitschrift Fur Die Gesamte Staatswissenschaft, 1997

We consider the transitions among intragenerational and alternative intergenerational financing a... more We consider the transitions among intragenerational and alternative intergenerational financing and liquidity risk-sharing mechanisms, in an Overlapping Generations model with endogenous levels of long-lived investments. The existence and characterization of a Self-Sustaining Mechanism, stable across generations, are established. The long-run equilibrium outcome, in a Proposal Game across generations, is shown to depend on the risk-aversion and propensity for early liquidity needs of the agents.

Bookmarks Related papers MentionsView impact

Research paper thumbnail of Does direct connect benefit travellers?

Economics Letters, 2020

Bookmarks Related papers MentionsView impact

Research paper thumbnail of Access Conditions, Investment and Welfare

We investigate the relationship between investment in new infras-tructure by telecoms operators a... more We investigate the relationship between investment in new infras-tructure by telecoms operators and the access conditions to such in-frastructure. We consider two variations of the problem. In the first, there is one infrastructure company which invests in upgrading its net-work. A second non-infrastructure company needs to gain access to that infrastructure in order to offer the same higher quality services. We find that cost based access to the new infrastructure leads to a reduction in investment and also a fall in consumer welfare. In the second variation, both companies invest, either non-cooperatively or co-operatively (joint venture). We find that invest-ment and consumer welfare is higher than in the case that only one invests and is forced to give access at cost to the other. To clarify the effects, we show that after an investment has been carried out, e.g. for legacy assets, the best regulatory policy is to give access at cost. Once companies can carry out autonomous inve...

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Research paper thumbnail of DG Comp's Discussion Paper on Article 82: Implications of the Proposed Framework and Antitrust Rules for Dynamically Competitive Industries

SSRN Electronic Journal, 2006

Bookmarks Related papers MentionsView impact

Research paper thumbnail of An Economic Take on Patent Licensing: Understanding the Implications of the 'First Sale Patent Exhaustion' Doctrine

SSRN Electronic Journal, 2010

Bookmarks Related papers MentionsView impact

Research paper thumbnail of Preventing Patent Hold Up: An Economic Assessment of Ex Ante Licensing Negotiations in Standard Setting

SSRN Electronic Journal, 2008

Bookmarks Related papers MentionsView impact

Research paper thumbnail of Collateral vs. Project Screening: A Model of Lazy Banks

SSRN Electronic Journal, 1998

Bookmarks Related papers MentionsView impact

Research paper thumbnail of The Optimal Scope of the Royalty Base in Patent Licensing

SSRN Electronic Journal, 2014

Bookmarks Related papers MentionsView impact

Research paper thumbnail of The Cost and Benefits of the Strict Protection of Creditor Rights: Theory and Evidence

SSRN Electronic Journal, 2000

Bookmarks Related papers MentionsView impact

Research paper thumbnail of Royalty Stacking In High Tech Industries: Separating Myth From Reality

Working Papers, 2007

Bookmarks Related papers MentionsView impact

Research paper thumbnail of The Ex Ante Auction Model for the Control of Market Power in Standard Setting Organizations

SSRN Electronic Journal, 2007

Bookmarks Related papers MentionsView impact

Research paper thumbnail of Pricing Patents for Licensing in Standard Setting Organisations: Making Sense of FRAND Commitments

Entrepreneurship, 2007

We explore potential methods for assessing whether licensing terms for intellectual property decl... more We explore potential methods for assessing whether licensing terms for intellectual property declared essential within a standard setting organization can be considered fair, reasonable, and non-discriminatory (FRAND). We first consider extending Georgia-Pacific to a standard setting context. We then evaluate numeric proportionality, which is modelled after certain patent pool arrangements and which has been proposed in a pending FRAND antitrust suit. We then turn to two economic models with potential. The first—the efficient component-pricing rule (ECPR)—is based on the economic concept of market competition. The second—the Shapley value method—is based on cooperative game theory models and social concepts for a fair division of rents. Interestingly, these two distinct methods suggest a similar benchmark for evaluating FRAND licenses, but ones which might appeal differently to the courts and competition authorities in the US as compared to Europe. We find that under any approach, p...

Bookmarks Related papers MentionsView impact