The VW Diesel Scandal: Turning a Blind Eye on Emissions to Protect the European Automobile Industry

October 16, 2015

(by Eugenio Miravete[1]) VW stands accused of exceeding the US EPA’s NOx standards by a factor of 10 or up to 40. What makes VW’s deception especially culpable is a sophisticated device designed to instruct the engine to run on clean mode when it detects that the vehicle is under lab testing conditions. Outraged commentators compare this to the behavior of the financial industry that led to the 2008 crisis. How did VW come to this? A significant part of the answer can be found in my own research, though this was not the issue I was investigating at the time. Read the rest of this entry »

The Economics of a $750 Pill

September 23, 2015

(by Farasat Bokhari) On Monday morning, the New York Times broke the story about a price hike in the USA from $13.50 to $750 per pill for Turing Pharmaceuticals’ drug Daraprim. Hillary Clinton tweeted, “Price gouging like this in the specialty drug market is outrageous. Tomorrow I’ll lay out a plan to take it on. –H”. Since Clinton’s plan is likely to include negotiated prices between pharma and Medicare, this in turn sent the Nasdaq Biotechnology Index down by 4.7% within the next two hours (see the Bloomberg graph below). Beyond the political repercussions, how can it suddenly be profitable to impose such an enormous price rise for an out-of-patent drug? Read the rest of this entry »

Would Jeremy Corbyn as Prime Minister mean the end of Competition Policy?

August 17, 2015

(by Andreas Stephan) The UK’s Labour party is currently in the process of selecting a new leader. The front-runner, Jeremy Corbyn, may become Britain’s first socialist Prime Minister in a generation. This blog post considers what a Corbyn government could mean for competition policy. Read the rest of this entry »

The European Commission’s Battle Over Pay-TV Services: Can Segmenting the EU Market Be Justified?

July 24, 2015

(by Andreas Stephan) Yesterday the European Commission issued a Statement of Objections to Sky UK and six major US film studios, taking the preliminary view that restrictions put in place to prevent consumers located elsewhere in the EU from subscribing to pay TV services amount to a breach of competition law. The question is whether these entertainment companies can respond with a real justification for dividing the market for European Pay TV services along national lines. Read the rest of this entry »

A Regulator’s Price Comparison Website is Not Sensible: comment on Catherine Waddams’s blog post

July 9, 2015

(by Stephen Littlechild) Catherine, I enjoyed your stimulating blog today. You are quite right to point out that CCP anticipated and confirmed the adverse effects that Ofgem’s non-discrimination clause had on competition, as now confirmed by the CMA. And I entirely agree with you that the proposed protective tariff for those that do not switch is very ill-advised. But I am puzzled why you consider it very sensible that Ofgem set up an independent price comparator website [PCW] for domestic customers. Read the rest of this entry »

Are the European Competition Authorities making a less anticompetitive market more anticompetitive? The saga

July 8, 2015

(by Pinar Akman) There are at least seven national competition authorities in the EU alone which have recently dealt with or are currently dealing with most-favoured-customer (MFC) clauses adopted by online platforms such as, Expedia, iBookstore, Amazon, etc. One of the most recent developments has been the acceptance of commitments offered by to the French, Swedish and Italian competition authorities. The acceptance of the said commitments might represent at best an ineffectual solution to any problem existing on the relevant market. In the worst case scenario, the commitments may have pushed the industry from a potentially less-anticompetitive equilibrium to a potentially more-anticompetitive equilibrium. Read the rest of this entry »

CMA Provisional Energy Market Findings: Does protecting the weak (even temporarily) make them stronger?

July 7, 2015

(by Catherine Waddams) In its provisional findings on the energy market, the UK’s Competition and Markets Authority (CMA) focuses on weak consumer response – but one proposal, to introduce a protective tariff for those who do not switch, might prove counterproductive. Read the rest of this entry »


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