Members and guests of the NBER's Program on Industrial Organization met at the Bureau's California office on January 25 and 26. The meeting was organized by Frank Wolak, NBER and Stanford University, and Catherine Wolfram, NBER and University of California, Berkeley. The following papers were discussed:
Francine Lafontaine, NBER and University of Michigan, and Scott E. Masten, University of Michigan, "Contracting in the Absence of Specific Investments and Moral Hazard: Understanding Carrier-Driver Relations in U.S. Trucking" Discussant: Nancy L. Rose, NBER and MIT
Justine S. Hastings, Dartmouth College, "Vertical Relationships and Competition in Retail Gasoline Markets"
Discussant: Andrea Shepard, NBER and Stanford University
Jun Ishii, University of California, Irvine, and Jingming Yan, Cornerstone Research, "The 'Make or Buy' Decision in U.S. Electricity Generation Investments"
Discussant: James Bushnell, University of California Energy Institute
Austan Goolsbee and Amil Petrin, NBER and University of Chicago, "The Consumer Gains from Direct Broadcast Satellites and the Competition with Cable TV" (NBER Working Paper No. 8317)
Discussant: C. Lanier Benkard, NBER and Stanford University
Charles King III, Alvin J. Silk, and Niels Ketelhohn, Harvard University, "Knowledge Spillovers and Growth in the Disagglomeration of the U.S. Advertising Agency Industry"
Discussant: Scott Stern, NBER and Northwestern University
Megan Busse, Yale University, and Matthew Shum, Johns Hopkins University, "Empirical Modeling of Endogenous Quality Choice: The Case of Cable Television"
Discussant: Thomas Hubbard, NBER and University of Chicago
Raphael Thomadsen, Columbia University, "Price Competition in Industries With Geographic Differentiation: Measuring the Effect of Location on Price in the Fast Food Industry"
Discussant: Aviv Nevo, NBER and University of California, Berkeley
Lafontaine and Masten consider various functions of contracting other than the protection of relationship-specific investments and the provision of marginal incentives. They apply the theory to explain variations in the form of compensation of over-the-road truck drivers in the United States. Specifically, they argue that contracts in this industry serve to economize on the costs of price determination for different types of transactions. The actual terms of those contacts vary systematically with the nature of hauls in a way that is consistent with the theory. By contrast, the authors...