Professor Ricardo Ribeiro's Lecture During the Microeconomics Seminar

Professor Ricardo Ribeiro (Católica Porto Business School) will be visiting the Faculty of Economic Sciences as part of the microeconomics seminar series coordinated by Professor Łukasz Grzybowski.

The speaker will present the study titled: “Estimating Oligopoly with Shareholder Voting Models”.

Further information about Professor Ricardo Ribeiro and his research can be found at the following link: https://ricardomribeiro.github.io/.

We invite all those interested in attending the lecture and engaging in a discussion with the speaker to join the seminar in Auditorium C (at the Faculty of Economic Sciences) on March 31 at 17:00. Remote participation via the Zoom platform is also available. (However, we encourage in-person attendance, as an informal meeting with the speaker is scheduled after the seminar, outside the Faculty)

Link to the meeting:  https://uw-edu-pl.zoom.us/j/92509806826](https://uw-edu-pl.zoom.us/j/92509806826

The abstract in presented below. (The full article is available via the following link: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3988265).

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We develop an empirical model of overlapping ownership conduct. The model (i) links firm conduct parameters to deep parameters of the firm's process of shareholder preference aggregation through voting; (ii) can cope with ownership settings involving both intra- and inter-industry overlapping ownership; and (iii) yields an equilibrium flexible formulation for the management's objective function that allows for no internalization, partial internalization and full internalization of shareholder objectives by managers. Using data for the U.S. airline industry in the 2015-2017 period, we find evidence for a partial internalization formulation in which managers put significant weight on shareholder objectives, but substantially less than in the full-internalization limiting case. We find also that inter-industry overlapping ownership is associated to lower inferred marginal costs, and that omitting inter-industry overlapping ownership leads to substantial bias towards zero in the parameters that drive how much intra-industry overlapping ownership is internalized by the firms. Finally, we find, focusing on the 2017Q4 period, that overlapping ownership overall (both intra- and inter-industry) seems to increase the average airline fare by 4.0%, increase industry profit by 24.4% and decrease consumer surplus by 1.8%, and that these effects are mostly due to overlapping ownership by shareholders other than the "Big Three" asset managers.