News

Impact of VAT-Exemptions in the Postal Sector on Competition and Welfare

A new publication written by Swiss Economics.

The research article «Impact of VAT-Exemptions in the Postal Sector on Competition and Welfare» by Swiss Economics and researchers from the University of Zurich shows how service providers exempted from the obligation to pay a value-added tax are favoured in competition. Further, this unequal treatment substantially affects outsourcing decisions and the labour market.

Helmut Dietl, Christian Jaag, Markus Lang, Martin Lutzenberger and Urs Trinkner (2011). «Impact of VAT-Exemptions in the Postal Sector on Competition and Welfare». In Reinventing the Postal Sector in an Electronic Age. Edited by M. Crew and P.R. Kleindorfer, Edward Elgar, pp. 267-280.

Published in the same book: Maegli Martin, Christian Jaag, Martin Koller and Urs Trinkner (2011). «Postal Markets and Electronic Substitution: Implications for Regulatory Practices and Institutions in Europe». In Reinventing the Postal Sector in an Electronic Age. Edited by M. Crew and P.R. Kleindorfer, Edward Elgar, pp. 109-122.

New research published

An article by Christian Jaag and Urs Trinkner has been published in  the Journal of Regulatory Economics.

The research article «The interaction between universal service costing and financing in the postal sector: a calibrated approach» by Christian Jaag and Urs Trinkner has been published in the Journal of Regulatory Economics.

To the document

Presentation at the DG MARKT economic seminar

Christian Jaag gave a presentation on «Yet another case of unintended consequences: VAT exemption and the public interest» at the DG MARKT economic seminar.

The presentation illustrates the distortive effects of VAT exemptions on competition in a newly liberalized industry and how they can be included in the calculation of the net cost of universal service obligations.

Presentation at the 2010 Conference on Competition and Regulation in Network Industries

Swiss Economics presented the paper «An Economic Framework to Understand and Assess Regulations in Network Industries».

Swiss Economics presented the paper «An Economic Framework to Understand and Assess Regulations in Network Industries» at the 2010 Conference on Competition and Regulation in Network Industries.

In addition to a theoretical framework, he also presented two applications: Liberalization in network industries and the development of regulation in the postal sector.

New staff member

Swiss Economics welcomes Oliver Fürst as a new staff member!

Oliver Fürst holds a Master of Arts in Economics and Business Administration from the University of Zurich. At Swiss Economics he works as a consultant for strategy and regulation in network industries.

Presentations at the Conference on Trends and Innovation for the Postal Market

Swiss Economics contributed three new research papers to the Conference on Trends and Innovation for the Postal Market.

Post Office Network Realignments and their Impact on Innovation
To the presentation

Postal Regulation, Declining Mail Volumes, and the Transformation of Business Models?
To the presentation

Postal markets and electronic substitution: What is the impact of intermodal competition on regulatory practices and institutions? The paper has received the «best paper award».
To the document

Presentations at the 18th Conference on Postal and Delivery Economics

Swiss Economics contributed with three presentations to the 18th Conference on Postal and Delivery Economics.

  • Impact of VAT-Exemptions in the Postal Sector on Competition and Welfare
  • Postal Markets and Electronic Substitution: What is the Impact of Convergence on Regulatory Practices and Institutions?
  • Practical Approaches to USO Costing and Financing

Presentation on International FTTH-Policies

At the «Second Annual Conference on Competition and Regulation in Network Industries» Christian Jaag has given a presentation on «Approaches to FTTH-Regulation: An International Comparison».

Christian Jaag gave a presentation on «Approaches to FTTH-Regulation: An International Comparison» at the 2nd Annual Conference on Competition and Regulation in Network Industries.

Presentation on the Future of Universal Services in the Postal Sector

A presentation by Urs Trinkner.

At the «IPC Senior Executive Forum on Regulation» Urs Trinkner has given a presentation on «Shaping the USO? An Outline of Thought from an Economic Perspective».

Presentation on Price Regulation in Postal Markets

A presentation by Christian Jaag.

At the 42nd Freiburger Verkehrsseminar, Christian Jaag gave a presentation on «Preisobergrenzen in liberalisierten Postmärkten» (in German).

Swiss Economics advises Commission for Aviation Regulation on the efficient level of capital costs for Dublin Airport

The Irish Commission for Aviation Regulation has published its draft decision on the maximum level of Airport Charges at Dublin Airport over the 2020-24 regulatory period. For the allowed rate of return on capital, the authority has relied on a report prepared by Swiss Economics.

Our report reflects that financial markets are currently undergoing exceptional times. Real government bond yields have fallen to a historically low level in the past couple of years, suggesting that the real expected return from risk-free assets is currently negative. Traditional approaches to estimating the cost of capital may fail to adequately capture the peculiarities of this new market environment. Hence, we assessed whether the ECB’s recent halt of quantitative easing is likely to have a significant effect on the market and analysed whether financial markets expect bond yields to rise again in the near future. Also, we considered evidence that expectations on equity returns may be more stable over time than underlying risk premia, indicating a so-called Total Market Return approach may be preferred over the traditional Equity Risk Premium approach to estimate the cost of equity.

The full report can be downloaded from the Commission for Aviation Regulation’s website.

Digitalization and international corporate taxation

Does digitalization require new rules for the international taxation of companies? OECD and the European Union try to change international tax law in favour of countries where consumption takes place.

In der aktuellen Ausgabe der Zeitschrift für Europarecht hat Christian Jaag zusammen mit Luzius Cavelti einen Leitartikel zum Thema «Die Bedeutung der Digitalisierung für das internationale Unternehmenssteuerrecht» publiziert.

Michael Funk speaks at the international MaCCI conference

Michael Funk recently gave his interpretation of the influential Post Denmark II decision to an audience at the Annual Conference of the Leibniz ScienceCampus 2019 Mannheim Centre for Competition and Innovation (MaCCI).

At the Annual Conference of Mannheim Centre for Competition and Innovation, Michael Funk presented a Swiss Economics research paper on competition economics. He argues that a notional as-efficient competitor, often used in the economic assessment of abuse of dominance cases, can be too efficient to be of relevance in practice. In particular, joint costs, which are required to comply with a Universal Service Obligation, should not be considered sunk when determining the cost structure for other services or else there is a risk of imposing unrealistic efficiency standards on competitors.

To the full conference programme

Benchmarking Electricity Distribution System Operators

Bundesnetzagentur published the latest benchmarking report by Swiss Economics. In the report, methodical details are carried out and the results are documented.

Swiss Economics, together with SUMICSID and IAEW carried out an efficiency comparison of electricity distribution system operators in the third regulatory period. Analyzed in detail was, among others, the illustration of decentralized generation. The published draft contains all important methodical aspects and documents the results. For the benchmarking, around 200 system operators were compared based on their cost efficiency. The final version will follow after the system operators have had the opportunity to comment on the draft.

To the publication

ACE Bologna, Case Presentation

Swiss Economics and COMCO present a case at the Annual conference of the Association of Competition Economists (ACE)

Screening tools can mitigate the dependency on whistleblowers and leniency applicants and enable the authorities to fight against bid rigging cartels proactively. The Investigation "See Gaster" in Switzerland was triggered by an ex-ante screening method developed by the Swiss Competition Commission. In the session, Yavuz Karagök (ComCo), Frode Steen (Norwegian School of Economics) and Michael Funk (Swiss Economics) discuss the strengths and weaknesses of screening methods with a concrete example.

To the presentation

Sharing Economy and public transport in Switzerland

Swiss Economics analyses the impact of the sharing economy on public transport.

Swiss Economics has investigated the impact of the sharing economy on public transport together with the University of Lucerne. Based on our discrete choice experiments we conclude that regulations are critical for the expected modal split.

Publication on a screening method to detect bid rigging

Samuel Rutz's article «Screening for «Bid Rigging Does it Work?» was recently published in the Journal of Competition Law & Economics.

The article discusses a screening method to detect bid rigging cartels. Based on the findings of the authors, the Swiss Competition Commission (COMCO) opened an investigation and sanctioned several firms for bid rigging.

To the published article
To the working paper

Dr. Christian Jaag and Dr. Samuel Rutz have recently been featured in Who's Who Legal 2018

Christian Jaag was named «leading expert» in the categories Legal Competition and Consulting Experts. Samuel Rutz was honoured as a «future leader» in the categories of Competition and Consulting Experts.

Dr. Christian Jaag and Dr. Samuel Rutz have recently been featured in Who's Who Legal 2018.

Christian is listed in Who's Who Legal: Competition as a leading economist. WWL says: «Christian Jaag is a superb competition economist who is regularly called on to advise both public and private-sector clients on strategy, regulation and policy.»In addition, he is listed in Who's Who Legal: Switzerland. WWL writes: «Christian Jaag is widely recognised as «a leading competition economist» and impresses peers with his «highly creative, precise and hands-on approach», as well as his «impressive theoretical and practical skills». Lastly, Christian is listed in Who's Who: Consulting Experts.
To Christian's biography on WWL

Samuel is listed as a future leader in Who's Who Legal: Competition and Who's Who Legal: Consulting Experts.

Publication on predatory pricing

The article «The more economic approach to predatory pricing» was recently published in the Journal of Competition Law & Economics.

Abstract: The «more economic approach» was introduced to antitrust to achieve a more effect-based and theoretically grounded enforcement. However, related to predatory pricing it resulted in systematic over- and under-enforcement: Economic theory does not require dominance for predation to be a rational (and harmful) strategy, although an ex-ante dominant firm would often refrain from predation. Hence, within the current legal framework which requires dominance for antitrust to apply, a more effect-based and theoretically grounded antitrust enforcement cannot pursue harmful predation. Therefore, we suggest separating predatory pricing from the exclusionary abuse of a dominant firm, both legally and analytically. Instead, predatory pricing should be analyzed along the same logic as a merger. In particular, we argue that three elements from merger control should be adopted: in the absence of dominance, market share and/or turnover thresholds may serve as a de minimis rule; recoupment should be analyzed similarly to the competitive effect of a merger between the predator and its prey, and a stronger efficiency defence should be established.

To the published article
To the working paper

New partnership with French audit and consulting firm OCA

The partnership with OCA strengthens Swiss Economics' competencies in the areas of calculation of damages. OCA will also allow us to more effectively support clients in multinational and multilingual disputes.

Swiss Economics is delighted to announce the recently established partnership with French audit and consulting firm OCA. This new collaboration strengthens our capacity to offer multi-jurisdictional and multilingual dispute resolution services.

OCA has successfully assisted its clients during commercial and financial arbitration and litigation across various countries. The firm's technical capabilities in the area of Corporate Finance and Valuation perfectly complement Swiss Economics' skills in Competition Economics and Industrial Organisation. In collaboration with OCA, we are able to offer our clients both, top-down empirical and conceptual economic evidence as well as detailed bottom-up asset valuation, leading to even more robust results.

In addition, the partnership will allow us to ramp up large-scale case teams proficient in German, French, and English and be able to provide our clients with rigorous analysis under tight time constraints.

For more information, please contact Swiss Economics Managing Partner Christian Jaag or OCA Chairman Mikaël Ouaniche.

Welcome to Swiss Economics

We welcome two new team members.

Tobias Binz is a Senior Consultant focusing on competition economics
Melanie Häner is a Consultant working on economic policy and competition projects
Postal regulation - Past & Future

A lecture by Christian Jaag.

At PostExpo 2017 Christian Jaag gave a speech on «Postal regulation - Past & Future».
Postcoin - The future of postal payments?

A lecture by Christian Jaag.

At PostExpo 2017 Christian Jaag gave a speech on «Postcoin - The future of postal payments?».