"The Use of Full-Line Forcing Contracts in the Video Rental Industry"

Research coauthored by BC economist Prof. Julie Holland Mortimer, Katherine Ho and Justin Ho has appeared in the April 2012 issue of the profession's flagship journal, American Economic Review. Their article focuses on firms' use of "bundling", a practice which is at the forefront of many policy debates as new technologies allow firms to implement more complex bundling arrangements. Realistic analyses of bundling--particularly between suppliers and retailers--require detailed data on both supply arrangements and consumer demand. The authors analyze firms' use of bundling as a vertical restraint (known as full-line forcing) using extensive supply and demand data from the video rental industry. Their model captures key details of the market that determine firms' contractual choices, and sheds light on the implications of these decisions. The authors' empirical approach provides a model for how to analyze bundling when detailed data are available.

An addition to the company of scholars

The latest addition to the department's roster of Ph.D.s is Marketa Halova, a native of the Czech Republic, who defended on 9 May. She wrote "Essays on International Asset Portfolios and Commodities Trade," advised by Profs. Fabio Ghironi and Christopher Baum. Halova has accepted a tenure-track position at Washington State University. Our congratulations to Dr. Halova.

Li, Mortimer join the BC economics faculty

Last year's faculty recruitment season was exceedingly successful, with the department filling four authorized positions in an attempt to reduce the pressure on undergraduate enrollments and strengthen the graduate program.

Assistant Prof. Ben Li joins us from University of Colorado-Boulder, where he received the Ph.D. this year. His interests are in international trade, economic development, and industrial organization. He has published in World Economy, Journal of Urban Economics, Economics Letters and Economics Bulletin. Li looks forward to teaching the graduate international trade course this fall and the undergraduate trade course next spring.

Associate Prof. Julie Holland Mortimer is our new hire in the field of industrial organization. She has been a member of the Harvard faculty since 2001, and serves as a Faculty Research Fellow of the NBER. Mortimer received her Ph.D. from UCLA in 2001, and has published in Review of Economic Studies, Quarterly Journal of Economics, Journal of Econometrics and Journal of Industrial Economics. She will be teaching undergraduate and graduate IO courses this fall.

Maxwell takes permanent position

Undergraduate Program FAQ available

A set of Frequently Asked Questions regarding the Department's undergraduate offerings is now available. If you are a major, minor, CSOM concentrator or interested in becoming one, please consult the FAQ!

"Promoting Product Market Competition: The huge potential for boosting jobs and growth"

Research coauthored by BC economist Prof. Fabio Schiantarelli and Ph.D. alumnus Giuseppe Fiori, published in the February 2012 issue of the prestigious Economic Journal, has demonstrated that 'Policies to promote competition in Europe's markets for good and services could raise the potential for job creation at little or no cost for the public purse.' Their findings, based on 20 developed countries in the OECD over more than 20 years, highlight the importance of stimulating competition and making it easier for new firms to enter markets in order to promote better employment outcomes. Over time, product market reforms lead to labor market reforms that enhance the positive effect on employment: what the research team calls a 'double dividend'. Their analysis shows, for example, that in heavily regulated countries, product market reforms could raise the overall employment rate--the percentage of people in the working-age population who are employed--by as much as 5.4 percentage points. This finding is of particular importance at present as many countries in Europe and elsewhere emerge from the Great Recession with a hangover of high unemployment and an urgent need to rein in large public deficits and growing public debt.

A longer discussion of their article's findings is available from the Royal Economic Society's website. Fiori, a 2010 BC Economics PhD, will join the North Carolina State University faculty next fall. Other authors of the study include Giuseppe Nicoletti and Stefano Scarpetta, both economists at the OECD. Schiantarelli, a member of the BC economics faculty since 1992, has published extensively on topics relating to product market reform and financial liberalization.