About Cartel Overcharges: Kroes is Correct

15 Pages Posted: 19 May 2010  

John M. Connor

Purdue University; American Antitrust Institute (AAI)

Date Written: February 1, 2010

Abstract

An article by Ehmer and Rosati (ER) in expresses dissatisfaction with a view expressed in a speech by Commissioner Neelie Kroes. As a justification for the high cartel fines imposed on cartels during her administration, she contends that most economic research indicates that the average cartel overcharge is likely to be 20% to 25%. This article defends Kroes’ assertion about the typicality of such overcharges. I argue in some detail that ER have it wrong. The overwhelming empirical evidence on cartel overcharges is reliable, scientific, and biased downward.

Suggested Citation

Connor, John M., About Cartel Overcharges: Kroes is Correct (February 1, 2010). Available at SSRN: https://ssrn.com/abstract=1610283 or http://dx.doi.org/10.2139/ssrn.1610283

John M. Connor (Contact Author)

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