Experts & Expertise

• Competition policy
• Economics
• Industrial organization
• Law and economics

Exclusion through speculation (with Bert Willems)
Abstract: Many commodities are traded on both a spot market and a derivative market. We show that an incumbent producer may use financial derivatives to extract rent from a potential entrant. The incumbent can indeed sell insurance to a large buyer to commit himself to compete aggressively in the spot market and drive the price down for the entrant. It can do so by selling derivatives for more than his expected production level, i.e. by taking a speculative position. This comes at the cost of inefficiently deterring entry.
JEL Classifications: K21, L12, L42
Keywords: exclusion, monopolization, contracts, financial contracts, derivatives, risk aversion, speculation
paper

Robustness to strategic uncertainty (with Ola Andersson and Jörgen Weibull)
Abstract: We model a player?s uncertainty about other players? strategy choices as smooth probability distributions over their strategy sets. We call a strategy profile (strictly) robust to strategic uncertainty if it is the limit, as uncertainty vanishes, of some sequence (all sequences) of strategy profiles, in each of which every player?s strategy is optimal under under his or her uncertainty about the others. We derive general properties of such robustness, and apply the definition to Bertrand competition games and the Nash demand game, games that admit infinitely many Nash equilibria. We show that our robustness criterion selects a unique Nash equilibrium in the Bertrand games, and that this agrees with recent experimental findings. For the Nash demand game, we show that the less uncertain party obtains the bigger share.
JEL Classifications: C72, D43, L13
Keywords: Nash equilibrium, refinement, strategic uncertainty, price competition, Bertrand competition, bargaining, Nash demand game
paper

Predation under perfect information
Abstract: In an oligopoly configuration characterized by high barriers to (re-)entry, a finite horizon, perfect information about demand and costs and the presence of three identical firms, we show that two of them (the predators) can choose to charge an initial price that is so low that the third (the prey) decides to exit immediately, after which the predators can enjoy higher profits, even if they do not raise their price. Predatory prices are thus observed on the equilibrium path and the predators end up earning more than in the best Bertrand (or even, collusive) equilibrium with three firms.
JEL Classifications: D43, L13, L41
Keywords: predation, predatory pricing, collusion, dynamic game, Bertrand competition
paper

Doctor of Economics, Stockholm School of Economics, 2006.

Master of Arts, Political Economy, Boston University, 2004.

Bachelor of Law, Université de Paris 1 (Panthéon-Sorbonne), 1998.

Diploma, Sciences Po, Paris, 1997.

2007-2012 Assistant professor, Tilburg University

2012-        Associate professor, Tilburg University

C. (Cédric) Argenton teaches the following subjects:

• Law and Economics (CentER) (230361) Further information
• Microeconomics 4 for EBE: Information Economics (30K302) Further information
• Microeconomics 4 for ECO: Information Economics (30L206) Further information

Director, Tilburg Law and Economics Center (TILEC)