On the rationale of leniency programs: a game-theoretical analysis

In order to enhance the enforcement of Antitrust Law, leniency policies were introduced in nearly all industrialized countries. These programs aim at deterring and eliminating cartels. In this paper we analyze the rationale of the current European and German leniency regulation. We challenge the contemporary view that the standard leniency privilege is incentive-compatible with respect to its aim to enhance competition. Instead, we argue for it to be used as a preemptive strike against competitors under circumstances where cartels become unstable. This implies a tightening of markets in subsequent periods and, thus, a potential reduction in competition intensity. Given strategic reasoning by agents, the principal witness may assure an economically privileged position in the future. This consequence might not be intended by the bonus regulations. Nevertheless if the leniency policies lead to more competition in the market the results should be welcomed by the national cartel offices. We give anecdotal evidence of the German cement case and base our arguments on a game-theoretical model.

Inside Lobbying on the Regulation of New Plant Breeding Techniques in the European Union: Determinants of Venue Choices

In July 2018, the Court of Justice of the European Union decided that new plant breeding techniques (NPBTs) fall within the scope of the restrictive provisions on genetically modified organisms (GMOs). Previously, various actors had lobbied in order to influence the European Union’s (EU’s) regulatory decision on NPBTs. This study examines the venue choices taken by Cibus, a biotech company that promoted NPBT deregulation. It shows that the firm bypassed the EU level and that it lobbied competent authorities (CAs) in certain member states to gain support for the deregulation of NPBTs. Cibus chose the CAs because their institutional “closedness” reduced the risk of the debate over the deregulation of NPBTs becoming public. However, the CA’s specific competences and their influence on EU decision making were of likewise importance. The firm lobbied CAs based in Finland, Germany, Ireland, Sweden, Spain, and the United Kingdom. Two factors appear to have influenced Cibus’ choices for these countries: high‐level political support for agribiotech and the high relevance of biotech sectors. In contrast, public support for GMOs turned out to have hardly any influence, and virtually no association could be observed for the agricultural application of biotechnology in the past nor for the weakness of domestic anti‐GMO lobby groups. Finally, the in‐depth study on Germany affirms that “closedness” was important for Cibus’ choices and reveals that technical information served as a venue‐internal factor that influenced the firm’s choices.     

Does transformational leadership stimulate user orientation? Evidence from a field experiment

While doing good for specific citizens and users is often considered a powerful motivator among public service employees, little research has rigorously evaluated how public managers can promote individualized prosocial motivation. We follow recent studies on the behavioural implications of ‘user orientation’ to explore how public managers can use a specific leadership strategy—transformational leadership—to reinforce employees' individualized prosocial motivation. Combining a field experiment with 80 childcare centre managers and survey reports from their 590 preschool teachers, we assess the effect of a transformational leadership training programme on user orientation. The results show a positive effect on user orientation three months after the training programme but no persistent effect 15 months after the intervention. This implies that, at least in the short term, public managers can use transformational leadership behaviours to stimulate user orientation.     

Party unity in parliamentary democracies: A comparative analysis

The level and causes of party unity are under-researched topics in parliamentary democracies, particularly in comparative perspective. This article presents a non-formal model explaining party unity in legislative voting as the result of individual legislators' decisions reacting to the incentives and constraints created by their respective institutional environments. Hypotheses derived from the model are tested against empirical data on party unity in 11 western parliamentary democracies since 1945. On the system level, central party control over nominations and intra-parliamentary resources as well as the strength of parliamentary committees with regard to policy decisions are shown to affect party unity as expected by the model. On the level of individual parties, governing parties are less unified than opposition parties and larger parties show higher unity than smaller ones. Both results shed doubt on frequent claims in the literature.     

The force of relationships: the influence of personal networks on the market for force

Since the 1990s, military support and security services in hostile environments have been increasingly traded on the market for force. Surprisingly, how exchange is organised on the market for force remains predominantly focused on the neoclassical model, which assumes anonymous exchange, and sellers compete through price and quality of product for customers. However, the model seems to be incomplete as it describes some empirical patterns, yet not others. Why are service backgrounds clustered together and why do specific nationalities dominate the market in the Iraq and Afghanistan war? Why are they not distributed evenly as price and quality competition would suggest? The argument here is that social factors need to be taken in to account, i.e. personal relationships. The logic being that sellers and customers trade through existing relationships, and familiarity is the dealmaker, rather than price. The article takes on the challenge to develop a sociological conceptualisation of the market able to integrate both logics. Finally, the approach is put to the test on the labour market for Western security operators. The results demonstrate that personal relationships play a significant role to explain exchange on the market for force, yet co-existence with the neoclassical logic.     

Public interest versus interest groups: a political economy analysis of allowance allocation under the EU emissions trading scheme

In a theoretical analysis, we use a common agency model to show that lobbying by energy-intensive sectors covered under an emissions trading scheme (ETS) shifts the regulatory burden of an economy-wide emission constraint to sectors outside the ETS. The emission tax on the latter becomes inefficiently high such that lobbying does not only induce burden shifting but also efficiency losses. A complementary empirical analysis for a cross section of German firms under the EU emissions trading scheme supports our theoretical result on the role of lobbying on allowance allocation.