Endogenous normative indices for the industry concentration

This paper presents new indices for measuring the industry concentration. The indices proposed (C n ) are of a normative type because they embody (endogenous) weights matching the market shares of the individual firms to their Marshallian welfare shares. These indices belong to an enlarged class of the Performance Gradient Indexes introduced by Dansby&Willig(I979). The definition of Cn for the consumers allows a new interpretation for the Hirschman-Herfindahl index (H), which can be viewed as a normative index according to particular values of the demand parameters. For homogeneous product industries, Cn equates H for every market distribution if (and only if) the market demand is linear. Whenever the inverse demand curve is convex (concave), H underestimates( overestimates) the industry concentration measured by the normative indexo For these industries, H overestimates (underestimates) the concentration changes caused by market transfers among small firms if the inverse demand curve is convex(concave) and underestimates( overestimates) it when such tranfers benefit a large firm, according to the convexity (or the concavity) of the demand curve. For heterogeneous product industries, an explicit normative index is obtained with a market demand derived from a quasi-linear utilility function. Under symmetric preferences among the goods, the index Cn is always greater than or equal the H-index. Under asymmetric assumptions, discrepancies between the firms' market distribution and the differentiationj substitution distributions among the goods, increase the concentration but make room for some horizontal mergers do reduce it. In particular, a mean preserving spread of the differentiation(substitution) increases(decreases) the concentration only if the smaller firms' goods become more(less) differentiated(substitute) w.r.t. the other goods. One important consequence of these results is that the consumers are benefitted when the smaller firms are producing weak substitute goods, and the larger firms produce strong substitute goods or face demand curves weakly sensitive to their own prices.

Monopoly power and trade protection: cross- industry evidence

This paper investigates the impact of industry concentration on trade policy. Annual panel-databases of Brazilian industries for the years 1988 through 1994 were used. The regressions reported here are robust to openness indicator. concentration index, control variables and sample size, and suggest that the higher the concentration of a given industry the higher its leveI of trade protection. In the period of study the country experienced a major trade liberalization, but the results in the paper show that the reduction in protection was smaller in more concentrated sectors. Assuming that concentration is ;1 gCl()d proX\' for mOllopoh' po\\'er as it reduces the free-rider problem in coordinating a lobby the results in this paper indicates that interest groups with control over specific markets in fact are able to obtain policy advantages that reduce (international) competition.

City sizes and industry concentration

In a general equilibrium model of trade under transportation costs between two cities we show how the relative population sizes are simultaneously determined with the degree of geographic concentration of industries characterized by different elasticities of scale of production. The effect on city size of the presence of nontraded goods is also analyzed .

Inferring conduct under the threat of entry : the case of Brazilian cement industry

This paper demonstrates that when an industry faces potential entry and this threat of entry constrains pre-entry prices, cost and conduct are not identified from the comparative statics of equilibrium. In such a setting, the identifying assumption behind the well-established technique of relying on exogenous demand perturbations to empirically distinguish between alternative hypotheses of conduct is shown to fail. The Brazilian cement industry, where the threat of imports restrains market outcomes, provides an empirical illustration. In particular, pricecost margins estimated using this established technique are considerably biased downward, underestimating the degree of market power. A test of conduct is proposed, adapted to this constrained setting, which suggests that outcomes in the industry are collusive and characterised by market division.

Sustainable miracles : protection and competition in the Brazilian oil industry

It is often suggested that competition improves productivity, however, the underlying support for this idea is surprisingly thin. This paper presents a case study examining the e ects of a change in the competitive environment on productivity at the Petrobras, Brazil's state-owned oil company. Petrobras had a legal monopoly on production, re ning, transportation and importation of oil in Brazil until it was removed in 1995. Even though Petrobras continues to have a de facto monopoly, the end of legal monopoly labor productivity growth rate more than doubled. A growth accounting of the industry shows that between 1977 and 1993 output growth rate (and productivity growth rate) is explained by the accumulation of capital, while Total Factor Productivity (TFP) decreased. Between 1994 and 2000 labor productivity growth rate is completely explained by the growth rate of TFP. The results suggest that the threat of competition alone is su cient to improve productivity. They also provide evidence that restricting competition help cause Brazil's depression of the 1980s.

Project portfolio management: an analysis from the insurance industry IT area

This paper aims to bring more information related to the critical question "how IT areas of insurance companies are defining and delivering their strategic initiatives Portfolios?" and make conclusions based on the collected data. To reach these interpretations, it is composed of a theoretical investigation on the theme, a strategy delineation for the research methodology and a conclusion presentation based on the findings. In this last part, this study concluded that explored organization does not applied a sufficient number of best practices answering the critical question as "the company is not mature on this subject".

The Brazilian venture capital industry and its strategic role in closing the financing gap of SMEs

This discussion paper is a contribution of the Brazilian Government to the 2006 Annual Conference of the OECD High-level Conference on "Better Financing for Entrepreneurship and SMEs" to be held in Brasilia, Brazil on 27-30 March 2006. It has been prepared by The Center for Studies in Private Equity and Venture Capital of EAESP-Fundação Getúlio Vargas under the auspices of ABDI – Agência Brasileira para o Desenvolvimento Industrial – an agency of the Ministry of Industrial Development and Foreign Trade, in cooperation with ABVCAP – The Brazilian Association of Private Equity and Venture Capital

The development of the private equity industry since the 2008 financial crisis

The private equity industry was experiencing a phenomenal boom at the turn of the century but collapsed abruptly in 2008 with the onset of the financial crisis. Considered one of the worst crises since the Great Depression of the 1930s, it had sent ripples around the world threatening the collapse of financial institutions and provoking a liquidity crunch followed by a huge downturn in economic activity and recession. Furthermore, the physiognomy of the financial landscape had considerably altered with banks retracting from the lending space, accompanied by a hardening of financial regulation that sought to better contain systemic risk. Given the new set of changes and challenges that had arisen from this period of financial turmoil, private equity found itself having to question current practices and methods of operation in order to adjust to the harsh realities of a new post-apocalyptic world. Consequently, this paper goes on to explore how the private equity business, management and operation model has evolved since the credit crunch with a specific focus on mature markets such as the United States and Europe. More specifically, this paper will aim to gather insights on the development of the industry since the crisis in Western Europe through a case study approach using as a base interviews with professionals working in the industry and those external to the sector but who have/have had considerable interaction with PE players from 2007 to the present.

The manufacturing industry in Brazil in the era of global value chains

This article presents a comprehensive and detailed overview of the international trade performance of the manufacturing industry in Brazil over the last decades, emphasizing its participation in Global Value Chains. It uses information from recent available global inputoutput tables such as WIOD (World Input-output database) and TIVA (Trade in Value Added, OECD) as well as complementary information from the GTAP 8 (Global Trade Analysis Project) database. The calculation of a broad set of value added type indicators allows a precise contextualization of the ongoing structural changes in the Brazilian industry, highlighting the relative isolation of its manufacturing sector from the most relevant international supply chains. This article also proposes a public policy discussion, presenting two case studies: the first one related to trade facilitation and the second one to preferential trade agreements. The main conclusions are twofold: first, the reduction of time delays at customs in Brazil may significantly improve the trade performance of its manufacturing industry, specially for the more capital intensive sectors which are generally the ones with greater potential to connection to global value chains; second, the extension of the concept of a “preferential trade partner” to the context of the global unbundling of production may pave the way to future trade policy in Brazil, particularly in the mapping of those partners whose bilateral trade relations with Brazil should receive greater priority by policy makers.

The consumer litigation industry: chasing dragon kings in lawyer-client networks

The community of lawyers and their clients form a scale-free bipartite network that develops naturally as the outcome of the recommendation process through which lawyers form their client base. This process is an example of preferential attachment where lawyers with more clients are more likely to be recommended to new clients. Consumer litigation is an important market for lawyers. In large consumer societies, there always a signi cant amount of consumption disputes that escalate to court. In this paper we analyze a dataset of thousands of lawsuits, reconstructing the lawyer-client network embedded in the data. Analyzing the degree distribution of this network we noticed that it follows that of a scale-free network built by preferential attachment, but for a few lawyers with much larger client base than could be expected by preferential attachment. Incidentally, most of these also gured on a list put together by the judiciary of Lawyers which openly advertised the bene ts of consumer litigation. According to the code of ethics of their profession, lawyers should not stimulate clients into litigation, but it is not strictly illegal. From a network formation point of view, this stimulation can be seen as a separate growth mechanism than preferential attachment alone. In this paper we nd that this composite growth can be detected by a simple statistical test, as simulations show that lawyers which use both mechanisms quickly become the \Dragon-Kings" of the distribution of the number of clients per lawyer.

The effect of guia exame’s ratings on the brazilian fund industry: an analysis of net-worth flows

This paper infers the impact the publication “Guia Exame” (the guide) has on the Brazilian fund industry, more specifically on the ability the concerned funds develop on attracting new investment. The impact is measured using the event-study analysis based on the variation of net worth subsequently to the event of being rated, according to the methodology applied by the guide to rank the funds. We used five years of fund ratings according to Guia Exame (2000-2004) and analyzed the changes of these funds’ net worth. We also compared the event amongst different categories of funds. The results found confirm the expected effects according to star rankings and asset manager size in all years.

Business process in supply chain integration in sugar and ethanol industry

This article presents the application of a diagnosis method in a Brazilian company from the sugar and ethanol industry to identify the level of supply chain integration. The diagnosis method is based on Cooper, Lambert and Pagh reference model for SCM. The method involves nine referential axes established from the eighth key business processes of the reference model.

An analysis of the perceived service quality of hospitality industry in Rio de Janeiro through the SERVQUAL model: a multiple case study

Brazil is under political and financial crises where the end seems far away. Because of that, researchers argue that the hotel rooms offered by Rio de Janeiro, built to host the Olympic Games 2016, will be difficult to occupy after the event. It is then necessary for the hotels to understand how guests perceive the service quality in order to adapt to this new era. If guests’ perceptions meet or exceed their expectations, they will be satisfied and will probably return. Thus based on the SERVQUAL approach, this paper aims to study the impact of the service dimensions on the guests’ overall satisfaction at hotels of Rio de Janeiro. Two hotels were considered representative of the city in terms of service quality and customers’ profile. Interviews to the hotel managers were performed, and questionnaires to the guests were administered. Among the five SERVQUAL dimensions – Reliability, Tangibles, Responsiveness, Assurance, and Empathy – the Empathy dimension appears to be the only one that affects the guests’ overall satisfaction. The study could also identify that gender, country of residence, home country and family income have an impact on guests’ satisfaction. This study has no intention of generalization, but rather of refining the theory about services and the SERVQUAL model.