Price-Fixing: Hefty Penalties on Big-Biz Cartels Will Provide Level Playing Field to Small Businesses
Economic Times, (Comments & Analysis), August 2012
University of Baltimore School of Law Legal Studies Research Paper
3 Pages Posted: 5 Jun 2013
Date Written: August 30, 2012
Abstract
Cartels are illegal in India, as they are almost everywhere. They are subject to heavy fines. Why, then, do businesses frequently try to fix prices? Because doing so usually is profitable. On average cartels raise prices by more than 20%, and probably face less than a 25% chance of being caught and convicted. Based upon a sample of 75 international cartels, the authors calculate that the expected profits from price fixing almost always exceed the penalties. No wonder businesses often try to fix prices.
Keywords: Antitrust, price fixing, India, cartels, India Antitrust law, fines, antitrust fines
JEL Classification: K19, K21, K29, K49, L40, L49
Suggested Citation: Suggested Citation