Regulation is probably "the" research topic that made university of Toulouse famous. It is inevitably attached to the name of Jean-Jacques Laffont the founder of IDEI, although his intellectual work embraces many more issues.
Regulation is at the crossroad of normative and positive economics. It is normative in that it does not restrict itself to describe institutions as they are; but it attempts to consider how they should be. It is positive in that it is not a mere normative prescription; but an attempt to propose applied solutions as to improve our institutions.
Central in my research program on regulation is the issue quality.
I have been looking first at the regulation of a monopoly in a context where, for technological reasons, only one quality of the good or services can be offered. A good example for such a context is provided by the air transportation industry where, for short-haul services, flight frequency is an important quality attribute that clearly cannot be differentiated across travellers. This provides the framework for:
- "Regulation in the Air: Price-and-Frequency Caps"
I explored further the subject of quality regulation together with my PhD Student Annalisa Vinella, now assistant professor at University of Bari. This gave rise to:
- "Partial Regulation in Vertically Differentiated Industries",
wich is also joint with Angela Bergantino, one of Annalisa's collegue.