We examine whether loss leading pricing strategies in multiproduct retailing should be a target of antitrust policy. Loss leading is modeled in the presence of imperfect competition and consumer information in a stage game framework. We show that price constraints, used as a second-best instrument, targeted at loss leading can interact with market imperfections to create distortions that can on...

The use of natural resource revenues for achievement of development has been a challenging issue for resource abundant countries. These challenges stem from the fact that incomes from natural resources are non-durable, unpredictable and uncertain. Different countries have pursued various approaches and tools for managing these revenues to avoid economic fluctuations. The international organizat...

BACKGROUND Natural disasters have severe impacts on the health and well-being of affected households. However, we find evidence that official damage cost assessments for floods and other natural disasters in Vietnam, where households have little or no insurance, clearly underestimate the total economic damage costs of these events as they do not include the welfare loss from mortality, morbidit...

This article studies a principal-agent problem with discrete outcome and effort level spaces. The principal and the agent are risk neutral and the latter is subject to limited liability. We consider the ratio between the first-best social welfare to the social welfare arising from the principal’s optimal pay-for-performance contract, i.e., the welfare loss. In the presence of moral hazard, we p...

A ban on pricing below cost was implemented under the 1987 Groceries Order based on the premise that loss leading used in multi-product retail pricing distorts competition and exploits consumers in the short run, while driving a more concentrated structure and reducing welfare in the long run. Loss leading is examined for multi-product retailers selling in imperfectly competitive market niches ...

Referral-based peer-to-peer networks have a wide range of applications. They provide a natural framework in which agents can help each other. This paper studies the trade-off between social welfare and fairness in referral networks. The traditional, naive mechanism yields high social welfare but at the cost of some agents—in particular, the “best” ones—being exploited. Autonomous agents would o...

Methods for analysing a hypothetical Foot and Mouth Disease (FMD) outbreak in the United States have improved greatly over cost-benefit methods. The estimated magnitudes vary greatly depending on assumptions about the epidemiological input, export loss and recovery, and consumer response. Greater consensus on those assumptions would narrow the range of estimates. Current research uses improved ...