About Cartel Overcharges: Kroes is Correct

15 Pages Posted: 19 May 2010

See all articles by John M. Connor

John M. Connor

American Antitrust Institute (AAI); Purdue University

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. and 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

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