16 Pages Posted: 8 Jan 2010
Date Written: 2008
Collusion is an agreement between two or more firms designed to limit competition among the group. This chapter considers the conditions that feasible agreements must satisfy in terms of the fundamental trade-off of increased payoffs from continuing participation and payoffs from ceasing participation. It also examines the incentives to enter into collusive agreements in the context in which these agreements are made.
Keywords: Collusion, cartel, agreements
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