The European Union as a System of Differentiated Integration: Interdependence, Politicization and Differentiation. IHS Political Science Series No. 137, 10 July 2014

This paper conceptualizes the European Union (EU) as a system of differentiated integration characterized by both variation in levels of centralization (vertical differentiation) and variation in territorial extension (horizontal differentiation) across policy areas. Differentiation has been a concomitant of deepening and widening and has increased and consolidated as the EU’s powers, policy scope, and membership have grown. Turning to explanation, the paper attributes the pattern of differentiated integration in the EU to the interaction of interdependence and politicization. Differentiation among the member states (internal differentiation) results from supranational integration under conditions of high interdependence and politicization. By contrast, external differentiation (the selective policy integration of non-member states) occurs in highly interdependent but weakly politicized policy areas. These constellations are illustrated in case studies of differentiation in the internal market, monetary union, and defence.

Stable coalition structures with fixed decision scheme

This paper studies the stability of a finite local public goods economy in horizontal differentiation, where a jurisdiction's choice of the public good is given by an exogenous decision scheme. In this paper, we characterize the class of decision schemes that ensure the existence of an equilibrium with free mobility (that we call Tiebout equilibrium) for monotone distribution of players. This class contains all the decision schemes whose choice lies between the Rawlsian decision scheme and the median voter with mid-distance of the two median voters when there are ties. We show that for non-monotone distribution, there is no decision scheme that can ensure the stability of coalitions. In the last part of the paper, we prove the non-emptiness of the core of this coalition formation game

Heterogeneity-promoting optimal procurement

When procurement takes place in the presence of horizontally differentiated contractors, the design of the object being procured affects the resulting degree of competition. This paper highlights the interaction between theoptimal procurement mechanism and the design choice. Contrary to conventional wisdom, the sponsor's design choice, instead of homogenizingthe market to generate competition, promotes heterogeneity.

Essais sur les logiciels libres : licences doubles, effets de réseau, et concurrence

This thesis examines the microeconomic consequences of the arrival of open source in the software market. Specifically, it analyzes three features of open source software by using specific models of industrial organization. Open source software is free, and may be modified or duplicated by anyone. The first paper studies the entry of an open source software in a closed source software market. Using a model of horizontal differentiation, the analysis considers a closed source firm's investment in the quality of its software. The introduction of open source on the market reduces the firm's investment in quality and increases the price of its software. Moreover, the entry of open source software may reduce consumer welfare. Post-entry by an open source software, the reduction in market share lowers the firm's incentive to invest in quality. The second paper features vertical differentiation to study a monopolist selling supporting product to its software. The study begins by contrasting the supply of support by an open source provider and a closed source vendor. The model shows that in both cases the levels of support offered are the same. In addition, consumer welfare is higher and profit lower under an open source software. Then, the paper considers the competition in the provision of support. Here, the supply of high level support is greater than under a monopolist. Finally, the monopolist adopts a dual licensing strategy to extract more surplus from developers interested in modifying open source software and redistributing the resulting product. This technique, when the developers place high value on the source code, generates more profit if the monopolist chooses to publish as open source rather than closed source. The last paper studies how a closed source firm is affected by the introduction of an open source benefiting from contributions by users. A vertical differentiation model is used, and reveals that, when contribution of users is present, the closed source vendor may lower its price to a level where it forces the open source out of the market. The firm's lower price not only increases demand for its software, but also induces consumers into switching from open to closed source software therefore reducing the contribution of users.

Health care network formation and policyholders' welfare

We develop a model in which two insurers and two health care providers compete for a fixed mass of policyholders. Insurers compete in premium and offer coverage against financial consequences of health risk. They have the possibility to sign agreements with providers to establish a health care network. Providers, partially altruistic, are horizontally differentiated with respect to their physical address. They choose the health care quality and compete in price. First, we show that policyholders are better off under a competition between conventional insurance rather than under a competition between integrated insurers (Managed Care Organizations). Second, we reveal that the competition between a conventional insurer and a Managed Care Organization (MCO) leads to a similar equilibrium than the competition between two MCOs characterized by a different objective i.e. private versus mutual. Third, we point out that the ex ante providers’ horizontal differentiation leads to an exclusionary equilibrium in which both insurers select one distinct provider. This result is in sharp contrast with frameworks that introduce the concept of option value to model the (ex post) horizontal differentiation between providers.

Bundling Strategies When Products Are Vertically Differentiated and Capacities Are Limited

We consider a seller who owns two capacity-constrained resources and markets two products (components) corresponding to these resources as well as a bundle comprising the two components. In an environment where all customers agree that one of the two components is of higher quality than the other and that the bundle is of the highest quality, we derive the seller's optimal bundling strategy. We demonstrate that the optimal solution depends on the absolute and relative availabilities of the two resources as well as upon the extent of subadditivity of the quality of the products. The possible strategies that can arise as equilibrium behavior include a pure components strategy, a partial- or full-spectrum mixed bundling strategy, and a pure bundling strategy, where the latter strategy is optimal when capacities are unconstrained. These conclusions are contrary to findings in the prior literature on bundling that demonstrated the unambiguous dominance of the full-spectrum mixed bundling strategy. Thus, our work expands the frontier of bundling to an environment with vertically differentiated components and limited resources. We also explore how the bundling strategies change as we introduce an element of horizontal differentiation wherein different types of customers value the available components differently.

Losses from Horizontal Merger: an Extension to a Successive Oligopoly Model with Product Differentiation

This paper generalizes the model of Salant et al. (1983; Quarterly Journal of Economics, Vol. 98, pp. 185–199) to a successive oligopoly model with product differentiation. Upstream firms produce differentiated goods, retailers compete in quantities, and supply contracts are linear. We show that if retailers buy from all producers, downstream mergers do not affect wholesale prices. Our result replicates that of Salant's, where mergers are not profitable unless the size of the merged firm exceeds 80 per cent of the industry. This result is robust to the type of competition.

Allocating ideas: Horizontal competition in tournaments

We develop a stylized model of horizontal and vertical competition intournaments with two competing firms. The sponsor cares about the qualityof the design but also about the design location. A priori not even thesponsor knows his preferred design location, which is only discoveredonce he has seen the actual proposals. We show that the more efficientfirm is more likely to be conservative when choosing the design location.Also, to get some differentiation in design locations, the cost differencebetween contestants can neither be too small nor too big. Therefore, ifthe sponsor mainly cares about the design location, participation in thetournaments by the two lowest cost contestants cannot be optimal for thesponsor.

Cell differentiation to "mating bodies" induced by an integrating and conjugative element in free-living bacteria.

Lateral gene transfer (LGT) is one of the most important processes leading to prokaryotic genome innovation. LGT is typically associated with conjugative plasmids and bacteriophages, but recently, a new class of mobile DNA known as integrating and conjugative elements (ICE) was discovered, which is abundant and widespread among bacterial genomes. By studying at the single-cell level the behavior of a prevalent ICE type in the genus Pseudomonas, we uncover the remarkable way in which the ICE orchestrates host cell differentiation to ensure horizontal transmission. We find that the ICE induces a state of transfer competence (tc) in 3%-5% of cells in a population under nongrowing conditions. ICE factors control the development of tc cells into specific assemblies that we name "mating bodies." Interestingly, cells in mating bodies undergo fewer and slower division than non-tc cells and eventually lyse. Mutations in ICE genes disrupting mating-body formation lead to 5-fold decreased ICE transfer rates. Hence, by confining the tc state to a small proportion of the population, ICE horizontal transmission is achieved with little cost in terms of vertical transmission. Given the low transfer frequencies of most ICE, we anticipate regulation by subpopulation differentiation to be widespread.

Stochasticity and bistability in horizontal transfer control of a genomic island in Pseudomonas.

Genomic islands (GEI) comprise a recently recognized large family of potentially mobile DNA elements and play an important role in the rapid differentiation and adaptation of bacteria. Most importantly, GEIs have been implicated in the acquisition of virulence factors, antibiotic resistances or toxic compound metabolism. Despite detailed information on coding capacities of GEIs, little is known about the regulatory decisions in individual cells controlling GEI transfer. Here, we show how self-transfer of ICEclc, a GEI in Pseudomonas knackmussii B13 is controlled by a series of stochastic processes, the result of which is that only a few percent of cells in a population will excise ICEclc and launch transfer. Stochastic processes have been implicated before in producing bistable phenotypic transitions, such as sporulation and competence development, but never before in horizontal gene transfer (HGT). Bistability is instigated during stationary phase at the level of expression of an activator protein InrR that lays encoded on ICEclc, and then faithfully propagated to a bistable expression of the IntB13 integrase, the enzyme responsible for excision and integration of the ICEclc. Our results demonstrate how GEI of a very widespread family are likely to control their transfer rates. Furthermore, they help to explain why HGT is typically confined to few members within a population of cells. The finding that, despite apparent stochasticity, HGT rates can be modulated by external environmental conditions provides an explanation as to why selective conditions can promote DNA exchange.

Field evaluation of safety during gestation and horizontal spread of a recombinant differential bovine herpesvirus 1 (BoHV-1) vaccine

Bovine herpesvirus type 1 (BoHV-1) is recognized as a major cause of respiratory, reproductive disease and abortion in cattle. Vaccination is widely applied to minimize losses induced by BoHV-1 infections; however, vaccination of dams during pregnancy with modified live virus (MLV) vaccines has been occasionally associated to abortions. We have previously reported the development of a BoHV-1 recombinant virus, constructed with basis on a Brazilian BoHV-1 (Franco et al. 2002a) from which the gene coding for glycoprotein E (gE) was deleted (gE-) by genetic manipulation. Such recombinant has been previously evaluated in its potential as a differential vaccine (gE- vaccine) that allows differentiation between vaccinated and infected animals. Here, in the first part of the present study, the safety of the gE- vaccine during pregnancy was evaluated by the intramuscular inoculation of 10(7.4) tissue culture 50 % infective doses (TCID50) of the virus into 22 pregnant dams (14 BoHV-1 seronegative; 8 seropositive), at different stages of gestation. Other 15 pregnant dams were kept as non-vaccinated controls. No abortions, stillbirths or fetal abnormalities were seen after vaccination. Seroconversion was observed in both groups of previously seronegative vaccinated animals. In the second part of the study, the potential of the gE- vaccine virus to spread among beef cattle under field conditions was examined. Four heifers were inoculated intranasally with a larger amount (10(7,6) TCID50) of the gE- vaccine (to increase chances of transmission) and mixed with other sixteen animals at the same age and body condition, in the same grazing area, at a population density equal to the average cattle farming density within the region (one cattle head per 10,000 m²), for 180 days. All animals were monitored daily for clinical signs. Serum samples were collected on days 0, 30, 60 and 180 post-vaccination. Seroconversion was observed only in vaccinated heifers. These results indicate that, under the conditions of the present study, the gE- vaccine virus did not cause any noticeable harmful effect on pregnant dams and on its offspring and did not spread horizontally among cattle.

The type-A horizontal cell: GABAergic characteristics and role in development of the outer plexiform layer

Morphological analysis of neonatal rabbit retina suggests that the type-A horizontal cell acts as the pioneer cell for development of the OPL. It is the first mature element of the OPL, and it forms the infrastructure upon which the OPL accrues. The role of type-A horizontal cells in influencing postnatal development of the OPL was examined.^ GABAergic characteristics of the type-A horizontal cell were defined. The type-A horizontal cell was found to possess two more GABAergic characteristics in addition to those previously demonstrated, during a short period in early postnatal development: endogenous stores of GABA and the GABA precursor, glutamate. Lesioning the type-A horizontal cell resulted in their permanent loss in addition to the disappearance of cone terminals and a dramatic increase in rod terminals within the OPL. Thus the type-A cells are not a necessary prerequisite for positioning the OPL in postnatal development, but may be necessary for establishment of the normal photoreceptor mosaic.^ Since type-A horizontal cells possess a number of GABAergic qualities during the period of cone photoreceptor cell differentiation, and there are reports of GABA's trophic action in other developing neuronal systems; the role that GABAergic type-A horizontal cells play in directing photoreceptor differentiation was examined.^ Disrupting effects of GABA-A receptor antagonists indicate that type-A horizontal cells act as postsynaptic targets for the growing cone terminals of photoreceptor cells. These trophic or synaptic interactions may involve GABA-A receptors activated by GABA released from horizontal cells. These findings are consistent with the hypothesis that type-A horizontal cells act as pioneering cells in directing the postnatal development of the OPL.^ These studies offer an in depth analysis of the structural and chemical relationship between type-A horizontal cells and other elements of the OPL from which the roles of type-A horizontal cells and the GABA system in development can be defined. They contribute to our knowledge of both structural and GABAergic mechanisms involved in central nervous system development. ^

Histologic Correlation Of Expression Of Ki-67 In Squamous Cell Carcinoma Of The Glottis According To The Degree Of Cell Differentiation.

Squamous cell carcinoma is the most common neoplasm of the larynx and glottis, and its prognosis depends on the size of the lesion, level of local invasion, cervical lymphatic spread, and presence of distant metastases. Ki-67 (MKI67) is a protein present in the core, whose function is related to cell proliferation. To evaluate the expression of marker Ki-67 in squamous cell carcinoma of the larynx and glottis and its correlation to pathological findings. Experimental study with immunohistochemistry analysis of Ki-67, calculating the percentage of the cell proliferation index in glottic squamous cell carcinomas. Sixteen cases were analyzed, with six well-differentiated and 10 poorly/moderately differentiated tumors. There was a correlation between cell proliferation index and degree of cell differentiation, with higher proliferation in poorly/moderately differentiated tumors. The cell proliferation index, as measured by Ki-67, may be useful in the characterization of histological degree in glottic squamous cell tumors.

Site Specific Spin Dynamics In Bafe2as2: Tuning The Ground State By Orbital Differentiation.

The role of orbital differentiation on the emergence of superconductivity in the Fe-based superconductors remains an open question to the scientific community. In this investigation, we employ a suitable microscopic spin probe technique, namely Electron Spin Resonance (ESR), to investigate this issue on selected chemically substituted BaFe2As2 single crystals. As the spin-density wave (SDW) phase is suppressed, we observe a clear increase of the Fe 3d bands anisotropy along with their localization at the FeAs plane. Such an increase of the planar orbital content is interestingly independent of the chemical substitution responsible for suppressing the SDW phase. As a consequence, the magnetic fluctuations in combination with this particular symmetry of the Fe 3d bands are propitious ingredients for the emergence of superconductivity in this class of materials.