Michael Jetter (9:00 am – 9:30 am)
Peacefully Demobilizing Rebels: Identity, Emotional Cues, and the FARC
In the early 2000s, the Colombian government aired messages during games of the national football team, urging FARC rebels to demobilize. We first study the strategy’s effectiveness, leveraging game dates, kick-off times, and spatial-temporal variation in rain-induced signal strength in a municipality-day-level panel spanning 2003-2016. Over 1,000 rebels demobilized because of family-themed (but not national-unity-themed) messages, received during unexpected losses (i.e., negative emotional cues). We then model a rebel’s demobilization decision, combining identity salience with their emotional state. Finally, we corroborate the model’s predictions examining family- versus non-family-specific holidays and local climatic anomalies.
Marianna Marino (9:30 am – 10:00 am)
Breaking Up Cartels, Self-Reporting and Innovation Outcomes
In this paper, we present empirical findings regarding the impact of self-reporting behavior on innovation outcomes within cartelized industries. Our hypothesis posits that self-reporting, instead of direct detection, provides antitrust authorities with superior information to effectively counteract the anticompetitive effects of cartel persistence. To examine this hypothesis, we employ a difference-in-difference approach that compares industries where cartels have been self-reported (treated) with those affected by cartels detected directly by the European Commission (controls) over the period 1996-2012. Our results indicate that the dissolution of cartels through self-reporting significantly increases the number of patent applications and patenting firms within previously cartelized industries. Notably, these effects are primarily driven by non-collusive patenting companies and new entrants to the market, respectively. Moreover, we extend our analysis by incorporating the 2002 reform of the EU leniency program, which enhanced the transparency and predictability of the leniency policy. We find that the effects of self-reporting on innovation outcomes are magnified following this reform, underscoring the positive influence of heightened transparency and predictability on the efficacy of self-reporting in promoting innovation within cartelized industries.
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