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Collusion and seasonality of market price - A case of fixed market shares

Author

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  • Sylwester Bejger

    (Faculty of Economics and Management Nicholas Copernicus University of Torun, Poland.)

Abstract

The paper develops a simple supergame model of collusion that focuses on the role of fixed (exogenous to game played) system of quantity market shares. Conclusions implied by the model could be used to motivate data - saving markers of collusion based on market price behavior. Following conclusions of the theoretical model we propose marker of collusion based on detecting changes in seasonal parameters of prices in periods of possible collusion. An empirical application of method has been done on well known data of Lysine cartel case.

Suggested Citation

  • Sylwester Bejger, 2010. "Collusion and seasonality of market price - A case of fixed market shares," Business and Economic Horizons (BEH), Prague Development Center, vol. 2(2), pages 48-59, July.
    • Handle: RePEc:pdc:jrnbeh:v:2:y:2010:i:2:p:48-59
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    References listed on IDEAS

    as
    1. Lars-Hendrik Röller & Frode Steen, 2006. "On the Workings of a Cartel: Evidence from the Norwegian Cement Industry," American Economic Review, American Economic Association, vol. 96(1), pages 321-338, March.
    2. Knittel, Christopher R. & Lepore, Jason J., 2010. "Tacit collusion in the presence of cyclical demand and endogenous capacity levels," International Journal of Industrial Organization, Elsevier, vol. 28(2), pages 131-144, March.
    3. de Roos, Nicolas, 2004. "A model of collusion timing," International Journal of Industrial Organization, Elsevier, vol. 22(3), pages 351-387, March.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Sylwester Bejger, 2015. "Screening for competition failures: some remarks on horizontal anticompetitive behavior visual detection," Ekonomia i Prawo, Uniwersytet Mikolaja Kopernika, vol. 14(2), pages 169-188, June.
    2. Sylwester Bejger & Joanna Bruzda, 2011. "Detection of Collusion Equilibrium in an Industry with Application of Wavelet Analysis," Dynamic Econometric Models, Uniwersytet Mikolaja Kopernika, vol. 11, pages 155-170.
    3. Bejger, Sylwester, 2012. "Cartel in the Indian cement industry: An attempt to identify it," Economics Discussion Papers 2012-18, Kiel Institute for the World Economy (IfW Kiel).

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    More about this item

    Keywords

    Collusion; repeated games; fixed market shares; seasonality of market price.;
    All these keywords.

    JEL classification:

    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L41 - Industrial Organization - - Antitrust Issues and Policies - - - Monopolization; Horizontal Anticompetitive Practices

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