Working Papers
Fewer Buyers, Higher Pay? Monopsony and Product Market Power in the U.S. Publishing Industry (JMP)
Abstract
In 2022, a U.S. federal court blocked the merger of Penguin Random House (PRH) and Simon & Schuster (SS)—the first U.S. merger halted solely on the basis of harm to an input market. Standard monopsony analyses evaluate the input market in isolation and overlook a countervailing force: a merger that raises downstream pricing power also raises the per-book profit a publisher expects to earn, which feeds back into more aggressive bidding for manuscripts. This paper quantifies both channels. Using a new dataset that links retail book sales to the corresponding rights transactions, I first examine the 2013 Penguin–Random House merger as a retrospective benchmark, and document patterns hard to reconcile with a pure-monopsony account. To decompose these effects, I build and estimate a structural model that nests an ascending-bid auction for manuscripts inside a differentiated-products demand-and-pricing model for books, with risk-averse publishers. Simulating the blocked PRH–SS merger, consumer surplus falls by $4.5 million (−2.1%) while total author compensation rises by $3.6 million (+1.8%): advances collapse for the narrow set of manuscripts the two firms jointly contested, but rise for the far larger set they did not, where heightened downstream pricing power lifts per-book profit and feeds back into more aggressive bidding. A monopsony-only analysis misses this second channel and can mis-sign the welfare effect on authors—the kind of two-sided assessment the 2023 Merger Guidelines now require.
Gender-Based Price Differences: The Case of Deodorants
Abstract
This article investigates the causes and consequences of gender-based price discrimination—the “pink tax.” Using data from the deodorant market, I document that female-oriented products are priced higher than male-oriented ones, and I estimate a differentiated-products demand-and-supply model under oligopoly to decompose this price gap. The results show that most of the disparity stems from differences in marginal costs. Counterfactual simulations indicate that enforcing gender price parity does not improve welfare for consumers of female-oriented goods as intended; instead, it leaves their surplus unchanged and leads to welfare gains for consumers of male-oriented goods.
Work in Progress
Insuring Consumers Against World Energy Shocks: Pass-Through, Market Power, and the Design of Fuel-Price Stabilization
Abstract
Governments spend enormous sums insuring consumers against international fuel-price shocks, most commonly through state-contingent adjustments to fuel taxes. Because these transfers are delivered through imperfectly competitive retail markets, their incidence is not mechanical: the share reaching consumers depends on pass-through precisely in the states of the world in which the program is active. I study the incidence, efficiency, and optimal design of such programs using Mexico's estímulo fiscal, a weekly rebate of the federal gasoline excise tax whose fiscal cost reached roughly 400 billion pesos (about 10% of federal tax revenue) during the 2022 oil shock. I combine daily station-level retail prices for the universe of Mexican stations, station-level sales volumes, and an essentially observed station-level marginal cost, which lets me test pricing conduct rather than assume it. The central mechanism is general: when pass-through is asymmetric or declining in market power, a subsidy that fires during cost spikes leaks to retail and wholesale margins exactly when the transfer is largest. Counterfactual simulations compare the stimulus against no intervention, an equal-cost lump-sum transfer, and a price cap, and characterize the optimal state-contingent rule.
Splitting the Crowd: Network Effects and Welfare Implications of Platform Competition (with Regina Seibel)
Abstract
Estimates of network effects are central to platform antitrust, yet remain scarce. We study competition among game-streaming platforms—Twitch, Kick, and YouTube Gaming—using daily streamer-level data around the 2022 entry of Kick into a market long dominated by Twitch. Exploiting events in which popular streamers switch platforms, we first show that incumbents on the destination platform gain viewership when a large streamer joins—evidence of network effects beyond a standard taste for variety. We then estimate a flexible nested-logit demand model in which a streamer's value depends on how many others share the platform, separately identifying network effects from congestion, and find network effects that overcompensate congestion. Pairing the demand estimates with a supply model of streamers' platform choice, we evaluate in ongoing counterfactuals whether entry by a challenger such as Kick can discipline a dominant incumbent, and how platform competition affects welfare when network effects are strong.
Does Top-Level Diversity Trickle Down? Evidence from U.S. Literary Prizes (with Yakov Bart, Samsun Knight, Julianna Spahr and Stephanie Young)
Abstract
Does diversifying prize-winners diversify the market? This premise motivates many high-profile diversity initiatives in cultural industries, yet is largely untested. Using library-checkout data from the Seattle Public Library covering over 135,000 authors and a staggered difference-in-differences design with matched controls, we estimate the effect of U.S. literary prizes on readership across author race and ethnicity. Prizes raise demand for winners of all backgrounds, but the effect is over twice as large for minority authors (77–97 log points) as for white authors (35–36 log points). Spillovers to non-winning authors of the same race are highly heterogeneous: null or positive for most groups, but significantly negative for Black authors, consistent with demand-side “token consumption” and yielding null net effects on the readership of Black authors overall. Top-down diversity initiatives can thus promote individual winners while doing little to diversify cultural consumption more broadly.
Pre-PhD Publications
When Context Matters: Uneven Firms’ Innovation Persistence in Developing Countries. Evidence from Uruguay, submitted (with Carlos Bianchi)
Abstract
A large body of literature has identified positive persistence effects of innovation in firms located in developed countries. These works have claimed that that there is a state dependence effect that explains firms’ innovation trajectories in a sort of self-efficient process. However, this is not the rule in developing economies. This article adds novel evidence to this topic by analysing innovation persistence in Uruguayan firms between 2007 and 2018. Using a panel data set from the Uruguayan Innovation Survey, we run parametric and nonparametric estimations of firms’ innovation persistence in manufacturing and service sectors. Our findings indicate that innovation is an uneven, even erratic, process. Contrary to most of the extant research on the topic, we find mostly negative persistence effects of outcome innovation (both product and process) in the short term and positive persistence effects of R&D and innovation activities based on the acquisition of external technology (input innovation) in the medium term. We discuss how firms and context characteristics explain heterogeneous and uneven firms’ innovative trajectories in developing countries, challenging the extended interpretation of innovation as a self-efficient process.
Innovation, work organization and knowledge sharing in Uruguayan firms (2023), Technology Analysis & Strategic Management (with Carlos Bianchi)
Abstract
How work is organised is a critical component of firms’ learning process. Because of that, the relationship between firms’ work organisation and their innovative effort is endogenous in nature and, in turn, causal effects are hardly identifiable. This paper aims to contribute by analysing the effects of organisational work practices oriented toward knowledge sharing and innovative efforts in Uruguayan firms between 2009 and 2015. Our research design allows us to test both the endogenous relationship and the potential causal effects, using econometric panel data techniques and instrumental variables. The results corroborate the endogenous relationship between these variables. Moreover, a positive and significant effect of communication practices on the innovative effort is identified in low-tech manufacturing firms but not in high-tech firms. This result offers valuable implications for public policy and industrial practices in developing countries since it reflects the main features of an innovation pattern that mostly relies on modernisation strategies rather than on high-tech innovations based on R&D.
El Aprendizaje entre Pares y sus Efectos en el Desempeño de los Estudiantes (2022), Desarrollo y Sociedad
Abstract
Tutorías Entre Pares es un programa desarrollado para mejorar la inserción de las generaciones de ingreso a la educación universitaria. Controlando por características demográficas, académicas y de personalidad, a través de métodos de emparejamiento se busca identificar si el programa tiene efecto sobre distintas dimensiones de los estudiantes. Los resultados muestran que el programa reduce la probabilidad de deserción, siendo una dimensión sobre la cual es esperado que actúe. Por otro lado, se observan resultados positivos sobre dimensiones académicas, de forma que los que participan aprueban más cursos y con mejores calificaciones que estudiantes similares que no participaron. Según estos hallazgos, este programa, destinado a trabajar directamente sobre dimensiones sociales, genera efectos sobre la esfera académica de los participantes. Estos hallazgos podrían representar un punto de partida para la formulación de políticas educativas con objetivos de mejorar las trayectorias en la educación universitaria.
Dependency Change with Aging and Associated Factors in Uruguay: A Cohort Study (2021), Journal of Aging and Health (with Alejandra Marroig and Graciela Muniz-Terrera)
Abstract
Objectives: To assess the heterogeneity of transitions toward dependency in older adults and to explore the robustness of results to different operationalizations of dependency. Method: Using data from people aged 60 years and older from a national representative study in Uruguay (Encuesta Longitudinal de Protección Social, N = 5071), we fitted multinomial regressions adjusted by sociodemographic and health characteristics to model transitions into dependency and death. We used a harder operationalization with basic activities of daily living (Katz-dependency) and Comprehensive-dependency with basic, instrumental, and advanced activities. Results: Increasing age (RRR = 1.08, CI = [1.05; 1.12], p < .001) and having comorbidities (RRR = 2.16, CI = [1.31; 3.57], p = .003) increased the risk of transition from nondependent to dependent using Katz-dependency. Women with at least two chronic conditions have increased risk of Comprehensive-dependency (RRR = 1.79, CI = [1.15; 2.80], p = .010). Discussion: Inconsistencies in findings emerged when evaluating transitions into dependency with the different measures, which may have social care implications.