Vertical chains are industry structures where some firms (at the upstream level) supply other firms (at the downstream level). Imperfect competition usually prevails at both levels, and upstream and downstream firms also bargain with one another. The goal of this project is to understand the industrial organization of vertical chains in terms of competition and bargaining to analyze its consequence on the price, variety and quality of the products offered to consumers. To reach this goal, our project combines theoretical industrial organization research with empirical and experimental approaches. This project follows a previous Franco-German project that was financed by the ANR and the DFG over the period 2008-2011. This previous project was fruitful in many respects. First, we have shown important and original results in each of the tasks we had identified, and in most cases, these results have provided guidelines for competition authorities. Second, several Franco-German collaborations have emerged and besides, some have led to publications in top journals. The first project was, however, mostly theoretical. This new project will help us not only maintain and increase the existing interactions between participants in the field of theoretical industrial organization, but also develop new interactions between empirical and experimental economists who have joined on both the French and the German side. Finally, adding empirical and experimental analyses will allow us to focus on essential issues of vertical chains using three different and highly complementary methods. The overall project consists of four work packages. The goal of the first work package is to understand how competition and the balance of power between upstream and downstream firms affect the different types of investments realized by firms within a vertical chain. In particular, we focus on vertically related firms’ incentives to invest in quality or in operating cost reduction, in quality labeling and in corporate social responsibility. The second work package aims at integrating the diversity of retail formats in the analysis of both retail competition and the balance of power between retailers and their suppliers. Multi-format retail competition results from the heterogeneity of consumer’s shopping behavior and is likely to generate specific competition strategies (cross subsidization, loss-leading, etc.) as well as new bargaining strategies towards suppliers. The third work package focuses on anticompetitive effects of contracts, such as foreclosure effects or the vertical control of competition within vertical chains. The last work package takes a dynamic perspective to analyze issues of collusion and reputation building as well as firms’ strategies in the presence of demand uncertainties.

Contemporary economies in Europe are constantly seeking ways to accelerate growth and achieve sustainable economic development. In this context, public policies play a crucial role: Among them are competition policy to monitor the behavior of firms, and procurement and regulatory policies which are designed to organize specific sectors. Recognizing the importance of public intervention as a major determinant of growth is only a starting point. Achieving good public policies requires the supervision of a public authority which implements efficient mechanisms in order to regulate the corporate behavior in firms. How these tools should be designed and implemented is subject to economic debate. Over the last 30 years, the literature focusing on industrial economics has proposed theoretical rules to researchers on how markets should be organized and regulated in order to maximize social welfare. Very few empirical tests of these theories have been proposed however. The aim of this research project is to attempt to bridge the gap between theory and reality, so that the tools of the economists can be understood and used by practitioners. This project has four main objectives: (i) To propose guidelines that help separating regulatory models that represent the economic reality of an industry from those that describe the optimal mechanisms to which the organization of the industry should aim to (positive versus normative analysis), (ii) to propose original microeconomic, statistical and econometric methodologies which allow representing the characteristics of the markets under scrutiny, (iii) to collect data and construct original databases that will be run in this current project and could be useful in future research, and (iv) to derive results that are useful for practitioners. To illustrate the variety of issues within the general theme of the project, we can raise the following questions: To what extent do the rules of competition in the markets affect the decisions of firms to improve their productivity and efficiency? Does competition guarantee low prices to consumers? Do the liberalization of utility industries and the search for new provision modes by public authorities accelerate the use of outsourcing? What are the efficiency conditions of competition for the market? How should the relationships between the governments and firms be organized in public-private partnerships? How should optimal regulatory rules be designed in order to maximize social welfare? Are regulators competent, sophisticated and benevolent enough to implement optimal regulatory rules? Should mergers between firms be allowed in industries where competition for the market is organized? These are just some examples of issues where an approach involving economists working in different fields such as industrial organization, contract theory, competition policy, and applied econometrics is of major interest. The Université Paris 1, Paris School of Economics, and GREMAQ offer a set of recognized talent in these disciplines and the first objective of this project is to unite the forces inside a team around these issues, which we think are important both in terms of research and public policy.

In France as in most developed countries, designing an efficient system of public financing for long-term care is one of the most striking challenges of the next two decades. But the deep lack of knowledge we face make the task rather uncertain. In this context, the main aim of this project is to establish some quantitative empirical evidences about how economic parameters, such as the private cost of formal home help for disabled elderly, impact their care arrangements. Getting an estimation of the price-elasticity of the demand for formal home help and of its effect on informal care will allow us to simulate the consequences of some reforms of the public financing scheme on care arrangements (quantity of home help provided by formal and informal caregivers), on the amount of public resources allocated to the elderly and on its distribution among them, according to income and disability level. Method The scarcity of econometrical research devoted to the impact of the cost of care in ageing economics is mainly due to the difficulty to collect precise data on prices and out of pocket expenditures, since, in many countries, this field of public policy is decentralized: the way public benefits are calculated thus differs according to the geographical location of the claimant. The French minister for health and social affairs will produce next year a specific survey, called CARE, which will include all the information needed to estimate our parameters of interest with standard econometric strategies, but will not be renewed afterwards. We thus propose, first, to use this survey to estimate the impact of private cost of formal help on care arrangement with standard models and methods and, second, to use the results as a benchmark for original alternative strategies, which require less specific data but rely on more sophisticated methods (partial identification) and take advantage on a precise knowledge of the decentralized rules of public financing. These alternative strategies will be implemented with administrative surveys used routinely for the follow-up of APA beneficiaries, the Handicap-Santé survey, which is renew every ten years, and a specific survey, called "Territories", conducted by our research team in 2012, in which we collected information from 73 metropolitan Conseils généraux on their practices regarding home services price-setting and demand subsidization. This gives to the project a methodological dimension since we will be able to evaluate estimation strategies, which could be usefull for analysing other fields of decentralized public policies. Working program Three alternative strategies will be implemented in the first part of the project : 1/ Estimating the price-elasticity of the demand for formal home help, using data of one specific department: in this case, the Territoires survey allows us to calculate the exact private cost of one hour of home help for APA beneficiaries cared by a service whose price was set by the local government. We already have the result for one département and will work on another one to test the robustness of our results. 2/ Estimating the price-elasticity of the demand for formal home help, using a sample of APA beneficiary gathered by the Health minister across 66 départements and partial identification methods : in this case, information is too poor to calculate the exact individual private cost, but the Territoires survey will allow us to establish a range of cost for each department. 3/ Estimating the impact of the amount of formal home help on informal care, through a bivariate model, using the Handicap Santé Survey. The Territoires survey will in this case offer proper instruments for the amount of formal home help in order to deal with the simultaneity of decisions regarding formal and informal care. In the second part of the project, we will use our estimation results to build a simulation model and analyze the impact of various reforms of price-setting and subsidization.

Agroecology, or, more accurately, several of its currents, has gain in recent years an important recognition, transforming from an “anti-establishment” model against the Green Revolution to an appropriate (or befitted) model to meet the challenges of global change. The success of agroecology is undeniable: of all currents critiquing the green revolution, this is the only one that has succeeded in being recognized as a viable agricultural model. This transformative process is accompanied by strong debates about what is or should be defined by the term agroecology, revealing thus the importance of speaking about agroecology in the plural form. The growing recognition of agroecologies is indeed marked by an increasing variety of forms of agriculture claiming themselves as forms of agroecology. If agroecology was an already very diverse field, its public recognition exacerbates this variability. In the last few years agroecology grew from a set of discreet alternative forms of agriculture that challenged the conventional agricultural model to a wide variety of forms having in common to be presented as more sustainable forms of agriculture. The IDAE project aims at understanding the processes at stake, which we will approach as various and differentiated institutionalization processes. We will carefully investigate how the different agroecologies have stabilized through various institutional supports, how they interact among themselves and transform each other, and which effects these institutionalization processes have on agroecological practices on the ground. We will identify and characterize the forms of institutionalization of agro-ecologies at the local, national and transnational scale. We will study the institutionalization of agroecologies at the inter/transnational scale in order to understand the overall context in which this process unfolds and to better contextualize the national case studies. Three large agricultural countries, where the debates on agroecology are both important and different, will be particularly studied: France, Brazil and Argentina. In each country, particular case studies will be analyzed at a fairly local level. Scientific dynamics of the project we will base on two approaches: an approach through the study of the various domains where the institutionalization takes place: i.e. economic, political and scientific; an approach through case studies, allowing to observe and report on the institutionalization processes at stake. The work will be structured around six work packages (WP). In the first (WP 1) the analysis of the institutionalization of agro-ecologies in France, Brazil and Argentina will be contextualized in view of global scale processes, by looking at how different agro-ecologies circulate. We will analyze in each country the policy (WP 2) and market dimensions (WP 3) of the institutionalization processes of agroecologies. Then we will be looking at how those processes result in a rearrangement of knowledge (WP 4). Finally, based on research conducted in the previous work packages, the last one (WP 5) will be devoted to the analysis of hybridization, coexistence and confrontations between conventional agriculture and agroecologies (WP 5). A coordination work package (WP 0) will be responsible for connecting the different work packages and partners to produce integrative studies.