Oxera’s monthly online publication brings you leading-edge economic thinking as it applies to business, law and regulation.
Behavioural economics is now used by many competition authorities. A recent study at the across economics, neuroscience and machine learning analyses consumer ‘hesitation’, shedding new light on the limits of their ability to assess information.
Businesses increasingly use consumer data to offer better and more targeted digital products and services. Many of these new business models rely on data to facilitate transactions and generate revenues in a way that was not previously possible. Access to personal data has understandably raised concerns about privacy. Based on a study commissioned by Which?, we investigate the delicate balance between privacy and the value of digital services
In March 2018 the UK government announced a plan to introduce a deposit return scheme for plastic, glass and metal drinks containers in England. Aimed at curbing pollution by stimulating recycling, the scheme will be consulted on later this year, and will bring England into line with many other EU countries that already have such schemes. From a traditional and a behavioural economics perspective, what conditions are necessary in order for these schemes to achieve the intended policy objectives?
Given the approval of the UK government’s National Airports Policy Statement on 5 June 2018, observers may think that the last remaining major obstacles have been removed and the bulldozers are ready to roll in to clear the site for the third runway at Heathrow. But in truth, as Mike Toms, Oxera Director, explains, there are still many hoops to jump through before the project gets off the ground
Is an excess of information hurting competition? Although there are some well-established, economically founded principles for assessing the exchange of information between competitors, the general increase in information availability in the digital economy presents new challenges. We revisit the economic principles that can be used to understand the likely effects, both beneficial and malign, of information sharing, and how competition authorities could react to these trends
Many banks make capital allocation decisions using the same profitability hurdle rate for all business units. Does that matter? We look at how this practice could lead to distortions at the business unit level, with potentially important consequences for shareholders, competitors and consumers
Recent transactions involving the merging of wholesale and retail activities (most notably the Tesco/Booker merger and the Co-op/Nisa merger) have led the UK Competition and Markets Authority (CMA) to introduce a new framework for assessing vertical mergers. What is the framework of analysis of these cases, and how can the vGUPPI tool be used in the context of grocery mergers?
In light of recent accounting scandals, there are widespread calls for the UK competition authority to re-examine the audit market. Yet spending a substantial amount of resources on a market investigation, and concluding once again that there is a competition problem, is of little value if a suitable remedy cannot be found. A break-up of the Big Four is perceived by many as a necessary and long-awaited intervention, but is it the right solution? And if not, what would be an alternative remedy?
The UK government is finalising its review into the future of telecoms infrastructure, which has included a call for evidence on market and policy models to support the necessary investment. Simon Pilsbury, Regulation Director at TalkTalk Group, one of the UK’s largest broadband providers, looks at the policy agenda that the government and Ofcom should adopt in order to stimulate ultrafast broadband investment across the UK. This follows an Agenda article in April 2018 on the same topic from BT’s perspective
The UK is experiencing a backlash against the liberal orthodoxy of utility regulation of ten years ago, which was based on privatisation, competition and deregulation. A recent Agenda article on the legitimacy of sectoral regulation in the UK asked ‘Is it policy, ownership, industry structure, governance, financing or regulation that is driving the problem?’ Martin Cave, Visiting Professor, London School of Economics, provides his perspective