Abstract

http://ssrn.com/abstract=1792500
 
 

References (40)



 


 



Exploring National Concerted Practices in an Open Small Economy:
What Does the Change in the Competition Law in the Netherlands Reveal?


Fatih Cemil Ozbugday


Tilburg Law and Economics Center (TILEC); Tilburg University - Department of Economics

March 22, 2011

TILEC Discussion Paper No. 2011-021

Abstract:     
The present study examines the impact of several industry characteristics on the propensity to collude using a dataset on the existence of collusion across Dutch industries during the late 1990s and early 2000s. The results of the Probit model with sample selection indicate that our sample of Dutch concerted practices is non-random in the sense that it only consists of anti-competitive agreements that were subject of an antitrust immunity behavior. Our bivariate probit model with sample selection indicates that concerted practices are less likely to be seen in service industries relative to manufacturing industries. The results also show that it is more likely that firms engaged in concerted practices in unconcentrated industries. Furthermore, we could not find a non-linear relationship between concentration and the presence of collusion. There is also strong evidence from all the regressions that concerted practices are less likely in industries where entry is more possible. Interestingly, our estimation results indicate that there is a positive correlation between cartel prevalence and import penetration, which implies that import competition did not discipline firm behavior and foreign importers joined the cartel paradise in the Netherlands. As to the role of measures of asymmetry on concerted practice prevalence, the association between patenting activity and propensity to engage in collusion is ambiguous in the current setting, while advertising intensity, as the second measure of asymmetry, is associated with increased likelihood of collusion. Contrary to the previous empirical findings, market growth has been found to have a negative effect on the probability of a concerted practice in an industry. Furthermore, our proposition that growing demand might attract new entrants, which, in turn, hampers collusion, has been falsified in the current context.

Number of Pages in PDF File: 61

Keywords: Cartels, Competition law, Overt collusion, Probit model with sample selection, the Netherlands

JEL Classification: K21, L41

working papers series


Download This Paper

Date posted: March 25, 2011  

Suggested Citation

Ozbugday, Fatih Cemil, Exploring National Concerted Practices in an Open Small Economy: What Does the Change in the Competition Law in the Netherlands Reveal? (March 22, 2011). TILEC Discussion Paper No. 2011-021. Available at SSRN: http://ssrn.com/abstract=1792500 or http://dx.doi.org/10.2139/ssrn.1792500

Contact Information

Fatih Cemil Ozbugday (Contact Author)
Tilburg Law and Economics Center (TILEC) ( email )
Warandelaan 2
Tilburg, 5000 LE
Netherlands
Tilburg University - Department of Economics ( email )
P.O. Box 90153
Tilburg, 5000 LE
Netherlands
Feedback to SSRN


Paper statistics
Abstract Views: 300
Downloads: 27
References:  40

© 2014 Social Science Electronic Publishing, Inc. All Rights Reserved.  FAQ   Terms of Use   Privacy Policy   Copyright   Contact Us
This page was processed by apollo7 in 0.469 seconds