Abstract

http://ssrn.com/abstract=2373309
 
 

Citations (1)



 


 



Multi‐Market Collusion with Demand Linkages and Antitrust Enforcement


Jay Pil Choi


Michigan State University - Department of Economics; CESifo (Center for Economic Studies and Ifo Institute)

Heiko A. Gerlach


University of Queensland - School of Economics

December 2013

The Journal of Industrial Economics, Vol. 61, Issue 4, pp. 987-1022, 2013

Abstract:     
This paper analyzes dynamic cartel formation and antitrust enforcement when firms operate in demand‐related markets. We show that cartel prosecution can have a knock‐on effect: bringing down a cartel in one market reduces profits and cartel stability and leads to the break‐up of the cartel in the adjacent market. Cartel prosecution can also have a waterbed effect: disrupting a cartel increases cartel stability in the adjacent market and induces cartel formation in previously competitive markets. We discuss the impact of dynamic cartel formation on consumer surplus, explore antitrust spillovers, the optimal scope of antitrust interventions and cartel formation with local firms.

Number of Pages in PDF File: 36

Accepted Paper Series





Date posted: December 31, 2013  

Suggested Citation

Choi, Jay Pil and Gerlach, Heiko A., Multi‐Market Collusion with Demand Linkages and Antitrust Enforcement (December 2013). The Journal of Industrial Economics, Vol. 61, Issue 4, pp. 987-1022, 2013. Available at SSRN: http://ssrn.com/abstract=2373309 or http://dx.doi.org/10.1111/joie.12041

Contact Information

Jay Pil Choi (Contact Author)
Michigan State University - Department of Economics ( email )
101 Marshall Hall
East Lansing, MI 48824
United States
517-353-7281 (Phone)
CESifo (Center for Economic Studies and Ifo Institute)
Poschinger Str. 5
Munich, DE-81679
Germany
HOME PAGE: http://www.CESifo.de
Heiko A. Gerlach
University of Queensland - School of Economics ( email )
Brisbane, QLD 4072
Australia
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