The Mandatory Bid Rule: Efficient,After All?

The mandatory bid rule has its origins in the UK and now applies throughout the EU and in many other jurisdictions. Under a mandatory bid, an acquirer of a controlling stake in a listed company has to offer to the remaining shareholders a buy‐out of their minority stakes at a price equal to the consideration received by the incumbent controller. While the rule warrants that no value‐destroying control transfers take place, it is often criticised for preventing value‐increasing transactions. This paper challenges some of the claims made by critics of mandatory bids. Highlighting the effects of synergy gains in private sale‐of‐control transactions, it is shown that mandatory bids prevent inefficient control transfers, where minority shareholder protection rules provide inadequate protection. Furthermore, mandatory bids help facilitate transfers to the most efficient bidders in multi‐bidder settings. The mandatory bid is justifiable, on economic grounds, in wider circumstances than is commonly assumed by law and economics scholars.     

Registered cartels in Austria: an overview

Cartels were legal to a large extent in Austria until the country’s EU accession in 1995. We examine archival material on registered horizontal cartels to learn about their inner working. Applying content analysis to legally binding cartel contracts, we comprehensively document different collusion methods along the lines described by Stigler (J Political Econ 72:44–61, 1964). Quota cartels employ regular reporting schemes and use compensation mechanisms for departures from set quotas. Specialization cartels divide markets, and rely the least on information exchange and punishment. Price and payment condition cartels primarily aim to prevent secret price cuts, requiring information provision upon request, allow for discretionary decision-taking and (sometimes immediate) punishment. These stylized facts on the contractual arrangements suggest that the possibility to write legally binding agreements was employed to address the usual obstacles to sustain collusion.     

EU accession and the hardening of soft budget constraints: some macro evidence

The hardening of soft budget constraints (SBCs) is a central element in transforming the economies of Central and Eastern Europe into market economies. This paper presents macro evidence on budget hardening of transition economies comparing the performance of EU accession countries relative to non-accession countries. We estimate SBC hardening for 21 transition economies in a partial adjustment model by measuring the reaction of employment to output changes over a 10-year period. The paper finds that accession candidates have reduced excess labour demand substantially relative to non-accession countries.

The relationship between childhood traumatic events,social support,and mental health problems in prisoners

This study examined the prevalence of childhood traumatic events (CTE), social support levels as well as mental health problems (MHP), to test for differences between traumatized and non-traumatized individuals, and to investigate the relationship among the aforementioned parameters in a sample of 49 prisoners in Switzerland. This cross-sectional study used standardized self-report measurements. In line with expectations, prisoners reported a high rate of traumatic events. Furthermore, results indicated that those traumatized differed from those non-traumatized regarding the level of social support, interpersonal sensitivity, and depression. However, no relationship between CTE and social support as well as MHP was found. This points to specific therapeutic needs of those traumatized, and to the necessity of a trauma-informed correctional care. Moreover, these study results are a further step into more integrated models of criminal behavior.     

The economic and legal significance of “full” deposit availability

European Journal of Law and Economics - Bank deposits have two characteristics: they are available on demand and at par value. Deposit redemptions face, at least given current technology, a lag...     

20 Years of global climate change governance research: taking stock and moving forward

International Environmental Agreements: Politics, Law and Economics - Research on global climate change governance is no longer primarily concerned with the international legal regime, state...