Bargaining power and outside options in the interbank lending market

The chapter analyzes the prospects for continued BRICS collective financial statecraft. Contrary to initial expectations, the BRICS (Brazil, Russia, India, China, and South Africa) have hung together by identifying common aversions and pursuing common interests within the existing international order. Their future depends not only on their bargaining power, but also on their ability to overcome domestic impediments to the sustainable economic growth that provides the basis for their international positions. To continue successfully with collective financial statecraft, the members must tackle the so-called middle-income trap, as well as their preferences for informal rules originating from their own institutional weaknesses or regime preferences. This study shows that, in the context of a global power shift, the BRICS club has operated to protect the member countries’ respective policy autonomy, while also advancing their joint voice in global governance. Recently, the BRICS have made concrete institutional gains, giving them expanded outside options to achieve specific objectives in global finance.

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Bargaining over crowdfunding benefits

Journal of Entrepreneurship and Public Policy ◽

10.1108/jepp-d-18-00009 ◽

2018 ◽

Vol 7 (2) ◽

pp. 166-177 ◽

Cited By ~ 4

Author(s):

Marco Bade

Keyword(s):

Bargaining Power ◽

Design Methodology ◽

Success Probability ◽

Venture Capitalists ◽

Policy Makers ◽

Content Type ◽

Equilibrium Allocation ◽

Outside Options ◽

Multi Stage ◽

Practical Implications

Purpose Crowdfunding creates multifaceted benefits for different agents who all desire to extract some of these benefits. The purpose of this paper is to analyze the allocation of crowdfunding benefits among crowdfunders, entrepreneurs, and venture capitalists. Design/methodology/approach The present paper develops a multi-stage bargaining model with a double-sided moral hazard. Findings It is demonstrated that higher entrepreneurial bargaining power vis-à-vis the crowd may not always be beneficial for the venture. Most importantly, this is due to the reduced success probability of crowdfunding resulting from higher bargaining power of the entrepreneur. Bargaining power and the value of outside options determine the equilibrium allocation of crowdfunding benefits, expected venture value, and thus expected wealth of all agents. Practical implications Entrepreneurs face a tradeoff between venture quality gains and worse outcomes from crowdfunding campaigns. Crowdfunding success and thus venture quality gains are the ultimate goal of policy makers if they aim to enhance the overall social welfare. Originality/value This paper is the first to investigate how multifaceted crowdfunding benefits are allocated between the crowd, entrepreneurs, and venture capitalists. The paper furthers the development of an appropriate regulatory framework for crowdfunding by depicting new and original effects related to crowdfunding.

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Supply Chain Innovations and Partial Ownership

Review of Industrial Organization ◽

10.1007/s11151-021-09836-9 ◽

2021 ◽

Author(s):

Matthias Hunold ◽

Shiva Shekhar

Keyword(s):

Supply Chain ◽

Knowledge Sharing ◽

Bargaining Power ◽

Supply Source ◽

Outside Options ◽

Industry Performance ◽

Partial Ownership

AbstractWhen knowledge sharing is non-contractible, we show that competing downstream firms may prefer to help improve an inefficient alternative supply source than help to improve the technology of the efficient actual supplier—even if this is costless. A downstream firm can have incentives to decrease the efficiency of the actual supplier in order to improve its outside options. Non-controlling partial backward ownership can—through the participation of the downstream firm(s) in the upstream profits—align the incentives of the supplier and its competing customers. This improves industry performance while simultaneously benefiting consumers. Partial backward ownership has similar effects as strengthening a downstream firm’s bargaining power and making knowledge sharing contractible.

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