With the unfolding of the financial crisis, the question could not have been more timely! TILEC members Hans Degryse and Steven Ongena, with co-author Moshe Kim (Haifa University), have recently published a text on the "Microeconometrics of Banking" with Oxford University Press. The book provides a compendium to the empirical work investigating the hypotheses generated by recent banking theory. It is an ideal companion to the celebrated book by Xavier Freixas and Jean-Charles Rochet on the microeconomic theory of banking. It follows the structure in Freixas and Rochet's text and arranges the relevant methodologies, applications, and results according to each of their original chapters in order to develop a coherent synthesis between available theory and supporting empirics. Each chapter in Microeconometrics of Banking contains a modest introduction (where possible and appropriate), a concise methodology section with one or more relevant methodologies, and several illustrative applications. In a "muscular" results section the authors summarize the main robust and seminal findings in the literature. Without doubt, this book will provide inspiration for many students, researchers and policy-makers concerned with financial intermediation in the years to come.

TILEC looking for a new manager

As a result of its considerable growth over the past years, resulting in some 60 researchers now being associated with it, and following the departure of Ilse van der Haar, TILEC currently has a vacancy for the position of manager. The position consists in maintaining and further developing the smooth functioning of the TILEC Office. The manager will be responsible for the daily management of TILEC and the supervision of the TILEC secretariat. He or she will intermediate between the scientists forming the TILEC management team and the university administration. TILEC is looking for an independent colleague who knows how to take charge. The ideal candidate is trained at the higher vocational education (HBO) or university level and has experience within a university environment. He or she also has several years of relevant work experience in management and administration, especially in taking care of project budgets. He or she is able to motivate administrative staff members and has excellent communication and social skills in Dutch as well as in English. Click here to see the full vacancy notice. The application deadline is set to 4 July 2009.

Should regulation promote diversity in media markets?

Is globalization threatening cultural diversity? Participants in the TILEC workshop on "Competition Policy and Regulation in Media Markets: Bridging Law and Economics", held in Tilburg on June 4 and 5 2009, discussed these and related questions. The meeting was organized by Ilse van der Haar and Lapo Filistrucchi, with the financial support of the Dutch Royal Academy of Sciences (KNAW). While Mina Burri Nenova (University of Bern) challenged the ability of the EU Audiovisual Media Directive to protect cultural diversity, Joel Waldfogel (University of Pennsylvania) used data from world music charts to show that, while Hollywood dominates world trade in movies, the US has grown less dominant in music markets, where domestic singers are still disproportionately popular. Rachael Craufurd Smith (University of Edinburgh) discussed how media pluralism considerations played a role in recent competition policy cases in the UK and the US, while Peggy Valcke (University of Leuven) presented the results of an inter-university project attempting at constructing indicators of media pluralism for European countries. Simon Anderson (University of Virginia) explained why, even according to conventional economic theory, merger policy in media markets should have the additional objective of preserving the variety of political viewpoints in the public arena.

The naked truth about exclusive dealing

Exclusivity clauses that commit a consumer to procure a good from a unique supplier are regularly debated in competition policy circles. One of the main 'theories of harm', the so-called 'naked exclusion' story, holds that an incumbent firm can play on buyers' coordination difficulties to deny an entrant the scale it needs in order to produce efficiently. In a recent TILEC discussion paper, TILEC members Jan Boone, Wieland Müller and Sigrid Suetens report experimental results on the impact of exclusive dealing inspired by this literature. Their key findings are as follows. First, exclusion is widespread in lab markets: it occurs in more than two thirds of all cases. Second, contrary to theory, allowing incumbents to discriminate between buyers increases exclusion rates only when offers can be made sequentially and secretly. Third, allowing discrimination does not lead to significant decreases in the costs of exclusion. Behind those observations lies the fact that buyers are more likely to accept an exclusive deal the higher the payment. The authors conclude that for practical purposes, an antitrust authority should be on high alert whenever the suspected firm (i) staggered its contracts over time, and (ii) took active measures to keep previous offers secret.

Mandating risk management

Does good governance follow from dispersing power in the corporation (independent directors, non-executive chairperson) or rather from coupling centralized decision-making with good risk management procedures? Legislators (as well as commentators) seem to hold different views on the subject. In a recent TILEC discussion paper, TILEC member Christoph van der Elst and co-author Marijn van Daelen (Tilburg University) analyze the dichotomy between the US and the EU corporate law approaches to internal control and risk management. Lawmakers from the US, the EU, and the EU Member States reacted to the scandals between 2000 and 2003 with provisions requiring public companies to have internal control and risk management systems in place in order to restore public confidence, but the substance of their responses differed. Developing a framework to identify the steps to be taken in establishing an operational internal control and risk management system (identification of the risk, assessment, monitoring, reporting) and to address the role of the different parties involved (senior management, board, audit committee, auditors) from a corporate law perspective, the authors conclude not only that the US and the EU regulatory approaches differ but also that both approaches are incomplete in several areas.