Tommaso Valletti Profile picture
Oct 6, 2021 8 tweets 4 min read Read on X
Exactly 450 years ago, 7 October 1571, one of the greatest sea battles ever: the Battle of #Lepanto. 1/
The battle was between the Holy League (commanders were Don Juan of Austria - Spain and half brother of Philipp II, Sebastiano Venier - Venice and Marcantonio Colonna - Papal States) and the Ottomans (led by Ali Pasha who died in the battle). 2/
It was the largest naval battle since classical antiquity, involving more than 400 warships.

It was fought entirely between rowing vessels (galleys and galeasses. Venice's Arsenale was INCREDIBLY fast in building them). 3/
And it was a massacre: 30,000 Ottomans died and 10,000 casualties were on the Holy League side. 250 ships were also sunk, and 100+ captured.

"The sea was red with blood".

4/
Despite the victory, the battle had no immediate consequence. The Holy League did not regain any territories lost to the Ottomans prior to Lepanto, and Venice lost the wider War of Cyprus. On land, the Ottomans were still expanding and in 1683 arrived at the gates of Vienna. 5/
But the victory had huge symbolic importance and was credited to the Virgin Mary (Our Lady of the Rosary). It exerted a great effect on European morale. It was the subject of paintings by Titian, Tintoretto, and Veronese. GK Chesterton wrote a poem Lepanto in 1911. 6/
Young Miguel de Cervantes fought in the battle!

He lost the use of the left arm and therefore is known as *El Manco de Lepanto* (the one-armed man of Lepanto) in the Hispanic world. This may not be true, but still mind-blowing that such a GENIUS began his career as a soldier. 7/
Today Lepanto is the Greek #Nafpaktos (Ναύπακτος), a fantastic town on the Ionian Sea/Gulf of Corinth. Must visit if you can.

[Disclosure: it's the beautiful home town of my wife!]

Ciao/FIN

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More from @TomValletti

May 6
Very interesting paper by Annika Stöhr just published in JCLE @OxUniPress

Meta-study on merger retrospectives. Main result: there seems to be a structural presumption -> mergers involving “large” firms are those with ex post increases in prices.


1/ academic.oup.com/jcle/advance-a…
Image
What’s particularly interesting is that these are all mergers that a) were vetted by comp authorities & b) were approved. Hence you'd expect prices either to stay constant or to go down because of the alleged efficiencies – right?

Wrong: in 52% of the cases prices went up.

2/ Image
This should raise a few questions about how much trust we should put in our "models". One in two go wrong (and what about those not vetted?). I would not call it good predictive power.

There's much more in the paper. Please read it.

Ungated version:

3/papers.ssrn.com/sol3/papers.cf…
Read 4 tweets
Oct 31, 2020
Thought-provoking piece – yet again! – from Germán Gutiérrez and @ThomasPHI2.

Common wisdom about dominant firms in the digital economy at odds with productivity paradox. Tremendous innovations by large “superstar” alongside lacklustre aggregate productivity growth. True?

1/
1. Market share of dominant firms has not increased (Panel A: domestic sales to domestic GDP; Panel B: consolidated global sales to global GDP).

2. Relative productivity of dominant firms has not increased since 90s (Panel A: top US firms; Panel B: global stars).

2/
3. Contribution of top firms to labor productivity has *decreased* by about 40%

Conclusion: not a paradox after all? Top firms now are neither larger nor more productive than past top firms. In fact their contribution to overall growth has declined -> paradox explained

3/
Read 4 tweets
Oct 30, 2020
There’s this @ecipe study (funded by Google) making the rounds, alleging that the European Commission's DSA will cost 2 million jobs and €85 billion per year in lost GDP! That’s a lot.

So I looked into it.

1/
Dubious methodologies and identification, but let’s ignore them. The core of the study is this: they have a bunch of country-sector EU data from 2010 to 2017. They estimate some TFP and see how TFP is affected by an “ex ante regulation” dummy that covers the period 2015-2017.

2/
What happened 2015? Explanation buried in footnote 3: “Regulation 2015/2020 shifts the general antitrust regulatory approach from ex post to a universal ex ante obligation in the EU telecom sector.”

3/
Read 4 tweets
Sep 13, 2020
Thread on research in economics & its linkage to policy.

Recent top publications on hot competition policy topics, eg
@jan_eeckhout & al on increasing margins
@joseazar @martincschmalz & al on common ownership
@cunningham_lbs @florianederer @ProfSongMa on killer acquisitions

1/
These papers freaked out corporate interests. Big Pharma, Big Tech, ‘Passive’ Investors (& good chunk of the legal community who’s behind them) reacted, as expected.

As they don’t know what academic research in economics is, they use shills under semi-academic camouflage.

2/
They pay for their own self-serving studies. Funding is opaque, to say the least. In some cases, they attack and harass.

These lobbying (sorry, research) centres don’t publish in any academic meaningful sense. And never will.

3/
Read 13 tweets
May 30, 2020
Important THREAD on the etymology of CAPPUCCINO.

First the spelling. It’s not capacino, capucino, capucinno, etc.
It's CAPPUCCINO (singular), 2P’s, 2 C’s, 1N. CAPPUCCINI (plural), still 2P’s 2C’s, 1N.

Second the etiquette. 1/
You don’t drink it after noon. You don’t order it after lunch, let alone after dinner. And absolutely terrible to drink it DURING a meal (I feel bad just at the thought of it). You don’t drink it in a plastic cup. You don’t drink it on the go. You don’t drink it with a straw. 2/
(Personal note: I split up with a British girlfriend when I tried to explain all this, observing in shock that the table next to ours had just ordered Hawaiian pizza (the horror!) and cappuccino at 10pm. Obviously the relationship was not going very well.) 3/
Read 8 tweets
Apr 26, 2020
I have been asked why, if in normal times we think competition is a feature of market-based economies that produces the best outcomes, we now hear that with corona "putting aside any qualms about competition" should be the best way forward for society (thanks @martincschmalz). 1/
Let me use simple steps using IO. As a starter, I’d say a plausible scenario could be one where there are uninternalized positive externalities, e.g. knowledge spillovers (or coordination problems in the supply chain), so that a competitive equilibrium is not ‘good enough’. 2/
But we already have e.g. a system of R&D exemptions for that… So one has to further ask why a) externalities are now bigger than before, b) a relaxation of comp rules would actually fix those externalities & c) the current system is not good to provide exemptions (too slow?). 3/
Read 6 tweets

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