Competition and Pay Inequality Within and Between Firms

2020 ◽  
Vol 66 (12) ◽  
pp. 5925-5943
Author(s):  
Claudine Gartenberg ◽  
Julie Wulf
Keyword(s):  
Business Strategy ◽  
Statistical Power ◽  
Free Trade Agreement ◽  
Market Competition ◽  
Trade Agreement ◽  
The Other ◽  
Null Effect ◽  
Pay Inequality ◽  
Division Managers ◽  
Do So

How does market competition affect pay inequality between and within firms? Using division managers as a pool of similar workers and the Canada–U.S. Free Trade Agreement, we find that greater competition increases overall pay inequality between, but not within, firms. This null effect within firms is not driven by a lack of statistical power. Instead, we find that it arises primarily within subsamples of firms with higher predicted levels of social comparison. Increased competition leads to greater pay-performance sensitivity among the higher-paid managers within firms, while it leads to greater overpayment among the other managers. These patterns are consistent with firm principals offering higher-powered incentives to their best managers and overpaying the rest. Altogether, this study suggests that, while competition leads to greater pay inequality overall, principals aim to maintain equality within firms and do so through the differential provision of incentives among employees. This paper was accepted by Bruno Cassiman, business strategy.

scholarly journals Globalization in the Balkans: Free trade agreement and the perspectives of attracting large institutional investors on the domestic capital market

Sociologija ◽  
2004 ◽  
Vol 46 (2) ◽  
pp. 167-182
Author(s):  
Ognjen Radonjic
Keyword(s):  
Free Trade ◽  
Institutional Investors ◽  
Free Trade Agreement ◽  
Trade Agreement ◽  
Domestic Market ◽  
Market Liquidity ◽  
The Other ◽  
The Balkans ◽  
Domestic Capital ◽  
International Investors

In order to take advantage of potentially positive effects that free trade flows have on economic growth, eight countries from South-East Europe united to create a regional free trade agreement. Significant market enlargement, cancellation of customs, tariffs and other export barriers create favorable opportunities for the development and growth of domestic companies. What is more, new sources of growth and development for local enterprises, as well as intensified competition, result in increased attractiveness of the region for large international investors. On the other hand, in order to take advantage of the presence of large international investors on the domestic market, it is very important to have in function a stable and rational financial system. Again, it is questionable how to develop in the most efficient way, at the moment, our underdeveloped financial market. A complementary solution is to attract large institutional investors on the domestic market, on one hand, and the foundation of domestic ones, on the other, in order to achieve a significant enlargement of the market liquidity as the basic determinant of its future development.

Does the Patent Linkage System Prolong Effective Market Exclusivity? Recent Evidence From the Korea-U.S. Free Trade Agreement in Korea

2019 ◽  
Vol 49 (2) ◽  
pp. 306-321 ◽  
Author(s):  
Kyung-Bok Son ◽  
SeungJin Bae ◽  
Tae-Jin Lee
Keyword(s):  
Free Trade ◽  
Free Trade Agreement ◽  
Market Competition ◽  
Trade Agreement ◽  
Event History ◽  
Market Exclusivity ◽  
New Chemical Entities ◽  
The Subject ◽  
Neutral Effect ◽  
Patent Linkage

This study evaluated the effect of the patent linkage system, fully introduced by the Korea-U.S. Free Trade Agreement in 2015, on patent challenges and the effective market exclusivity of new medicines in Korea. We used pharmaceutical approval data and pharmaceutical litigation data to detect new medicines and their counterparts, to collect patent challenges against new medicines, and to calculate effective market exclusivity for new medicines. Then, a nonparametric event history model was applied to statistically explain the duration of the market exclusivity of new medicines. Between 2007 and 2011, a total of 94 new medicines, consisting of 82 new chemical entities and 12 new biologics, were approved. The patent linkage system encouraged patent litigations to occur sooner, with a race to challenge the patents by various generic applicants. However, it was difficult to conclude that patent challenges had a significant impact on the prolongation of effective market exclusivity. The patent linkage system had a neutral effect on the effective market exclusivity of new medicines and encouraged patent challenges without abbreviating effective market exclusivity. In addition, this study highlights an important issue regarding biologics that has not been the subject of market competition, even for patent challenges.

scholarly journals Dampak Keikutsertaan Indonesia di Dalam RCEP Terhadap Volume Perdagangan – Bukti Dari Gravity Model

2019 ◽  
Vol 3 (2) ◽  
pp. 151-160
Author(s):  
Yunarwanto Yunar
Keyword(s):  
Panel Data ◽  
Free Trade Agreement ◽  
Trade Agreement ◽  
The Other ◽  
Gravity Models ◽  
Comprehensive Model ◽  
Asean Member ◽  
Trading Partners ◽  
Endogenous Variables ◽  
The Impact

RCEP is a mega Free Trade Agreement which the existence was built with the aim of bridging the diversity of conditions and economic volume of each ASEAN member is very interesting to study whether indeed that goal can be achieved. By using trade panel data from 2001-2016 to Indonesian trading partners from RCEP member countries, and the econometric method, how much influence RCEP influences on Indonesian trade is measured. GDP, and the Population significantly affect to trade, while Distance is significantly negative correlated. The variation of all variables with the coefficient of Good of Fit shows the benefits are ambiguous, with 49.98% Gravity models can explain endogenous variables of trade, while the other 50.02% have other factors outside the model. Institutional Progress, Logistics Effectiveness, Corruption Perceptions, Consistency of Rule-Law, and Competitiveness Index could be those other factors. Further research is needed to locate a better comprehensive model. Thus Indonesia's participation in RCEP if it only relies on Gravity variables, the impact on trade could might increase or otherwise.

Investor-State Arbitration under NAFTA Chapter 11

2000 ◽  
Vol 37 ◽  
pp. 99-137
Author(s):  
J. C. Thomas
Keyword(s):  
Free Trade ◽  
Free Trade Agreement ◽  
Trade Agreement ◽  
The Other ◽  
Foreign Investors ◽  
The North ◽  
Legislative Activity ◽  
Nafta Chapter 11 ◽  
Extraordinary Means

SummaryChapter 11 of the North American Free Trade Agreement (NAFTA) provides for suits by foreign investors from the NAFTA Parties against one of the other Parties. The author reviews this provision and discusses its possible ambit in light of the decisions so far rendered. The author considers that, properly interpreted, Chapter 11 will provide an extraordinary means of redress and will not open the floodgates to all kinds of claims that second-guess legitimate governmental legislative activity or policymaking.

scholarly journals Marketing Alberta Natural Gas in the United States after the Free Trade Agreement: Negotiating the U.S. Regulatory Maze

1990 ◽  
Vol 28 (1) ◽  
pp. 94
Author(s):  
Douglas F. John
Keyword(s):  
United States ◽  
Natural Gas ◽  
Free Trade ◽  
Free Trade Agreement ◽  
Free Market ◽  
Market Competition ◽  
Critical Role ◽  
Trade Agreement ◽  
The United States ◽  
Energy Regulatory

Although the border between Canada and the United States for natural gas has been open for some time now, the free-market development of natural gas industries is changing from short-term deal-making to long-term industry placement. Here the Canada-United States Free Trade Agreement will take on a critical role in permitting decisions on elements of trade to be made more confidently. This article focuses on key U. S. federal regulatory principles and programs and how Congress's intention in the Natural Gas Act has been carried through so that the federal government will no longer occupy the field of gas regulation, but ensure that where the use of that commodity involves the interests of two or more states, the overall national public interest would be protected. Therefore, producing states would regulate the physical production of gas before it enters the stream of interstate commerce as well as control matters entirely intrastate in nature. The future of contract demand conversions and gas inventory charges will allow customers to purchase gas from a variety of competitive suppliers without suffering a loss of service reliability. In effect gas inventory charges represent the Federal Energy Regulatory Commission's attempt to prevent pipelines from finding them selves with massive take-or-pay liabilities. Through Order No. 436, the Commission has attempted to streamline the regulatory approval process for pipeline construction projects and in turn to foster market competition. The author argues that rate reform is making its way towards what he feels is its natural conclusion where contract, rather than regulation, will be the principal determinant of right and obligation between industry participants at the interstate level. The Federal Energy Regulatory Commission would become more of a referee than director for questions of anti-competitive behaviour in the use of interstate facilities.

Optimization of the consumption function under the North American Free Trade Agreement

2021 ◽  
Vol 9 (2) ◽  
pp. 87-103
Author(s):  
Dora Ledesma ◽  
Lidia Hernández-Hernández ◽  
María Teresa Leonor Muciño-Porras
Keyword(s):  
Free Trade ◽  
Optimization Model ◽  
Tax Policy ◽  
Free Trade Agreement ◽  
Trade Agreement ◽  
The Other ◽  
Support Programs ◽  
Consumption Function ◽  
The North ◽  
The Government

In the last 40 years, the country has turned to developing the primary and tertiary sectors with a tax policy heavily taxing goods outside the basic basket and generalizing others. On the other hand, Government implemented support programs for vulnerable sectors. The imbalance between what the government receives and grants created greater poverty, affecting mainly households in the first three income deciles. This work shows this imbalance in different scenarios using an optimization model.

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