Do Research Joint Ventures Serve a Collusive Function?

Journal of the European Economic Association ◽

10.1093/jeea/jvab041 ◽

2021 ◽

Author(s):

Michelle Sovinsky

Keyword(s):

Policy Change ◽

Joint Ventures ◽

Petroleum Refining ◽

Product Market ◽

Empirical Literature ◽

Firm Level ◽

Level Information ◽

Research Joint Ventures ◽

Firm Attributes ◽

Average Drop

Abstract Every year thousands of firms are engaged in research joint ventures (RJV), where all knowledge gained through R&D is shared among members. Most of the empirical literature assumes members are non-cooperative in the product market. But many RJV members are rivals leaving open the possibility that firms may form RJVs to facilitate product market collusion. We examine this by exploiting variation in RJV formation generated by a policy change that affects the collusive benefits but not the research synergies associated with a RJV. We use data on RJVs formed between 1986 and 2001 together with firm-level information from Compustat to estimate a RJV participation equation. After correcting for the endogeneity of R&D and controlling for RJV characteristics and firm attributes, we find the decision to join is impacted by the policy change. We also find the magnitude is significant: the policy change resulted in an average drop in the probability of joining a RJV of $41\%$ among computer and semiconductor manufacturers, $34\%$ among telecommunications firms, and $33\%$ among petroleum refining firms. Our results are consistent with research joint ventures serving a collusive function.

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Wage-setting practices in the metalworking sector in Greece

Employee Relations ◽

10.1108/er-09-2019-0356 ◽

2020 ◽

Vol 42 (6) ◽

pp. 1441-1463

Author(s):

Daphne Nicolitsas

Keyword(s):

Market Competition ◽

Industrial Relations ◽

Product Market ◽

Structural Features ◽

Collective Agreement ◽

Wage Setting ◽

Firm Level ◽

Content Type ◽

Level Information ◽

And Performance

PurposeThe paper aims to link product market features in the Greek metal processing sector to the wage-setting practices followed therein.Design/methodology/approachAggregate business structural statistics are used to document the product market structure features while information from a rich sectoral collective agreement database, covering a number of sectors of the Greek economy, is used for the wage-setting practices. The approach is, in general, descriptive and discursive with the use of some regression analysis.FindingsThe main findings of the paper include: first, the metal sector as a whole is heterogeneous in terms of its structural/productive features; second, the type of collective agreements followed in the subsectors of the metal sector appear related to the structural features of the subsectors; third, negotiated wages appear binding for subsectors facing less product market competition; and finally, the ability to opt out of the sectoral agreement and sign firm-level agreements during the recent crisis in Greece was used mainly by firms suffering accounting losses.Research limitations/implicationsThe research results are limited by the absence of detailed firm-level information both on the actual wages paid and on the exact industrial relations practices in the workplace.Originality/valueIn view of the changes taking place in industrial relations in general and collective bargaining in particular, the issue of the homogeneity – in terms of structure and performance – of individual sectors, sets the question of whether one size (agreement) fits all and consequently whether extensions of agreements to whole sectors are advisable. This is the spirit in which the paper is written. The originality is linked both to the issue addressed but also to the use of the detailed collective labour agreements information and its association with product market features.

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