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The role of economics in cartel detection. A review of cartel screens

Author

Listed:
  • Iuliana Zlatcu

    (Bucharest University of Economic Studies, Romania)

  • Marta-Christina Suciu

    (Bucharest University of Economic Studies, Romania)

Abstract

In their desire to gain market share and profit, companies often resort to certain anti-competitive practices. Among them, it is well known that cartels are considered the most serious infringement of competition law. Cartels aim to increase their prices and profits at the expense of the consumers’welfare by avoiding the risks of competition and reducing the uncertainty in the market. In order to uncover cartels, screens can be a useful tool for competition authorities, using them to support opening an investigation or to filter industries prone to anticompetitive behaviour for further investigation. Screens can also help authorities to estimate the duration of the infringement, by identifying the starting point and the ending of the respective practice. This paper reviews the main screens identified in the empirical literature and also used by competition authorities in order to uncover firms’ behaviours which are more likely to be consistent with collusion than with competition.

Suggested Citation

  • Iuliana Zlatcu & Marta-Christina Suciu, 2017. "The role of economics in cartel detection. A review of cartel screens," Journal of Economic Development, Environment and People, Alliance of Central-Eastern European Universities, vol. 6(3), pages 16-26, September.
    • Handle: RePEc:sph:rjedep:v:6:y:2017:i:3:p:16-26
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    References listed on IDEAS

    as
    1. Bolotova, Yuliya & Connor, John M. & Miller, Douglas J., 2008. "The impact of collusion on price behavior: Empirical results from two recent cases," International Journal of Industrial Organization, Elsevier, vol. 26(6), pages 1290-1307, November.
    2. Green, Edward J & Porter, Robert H, 1984. "Noncooperative Collusion under Imperfect Price Information," Econometrica, Econometric Society, vol. 52(1), pages 87-100, January.
    3. Abrantes-Metz, Rosa M. & Froeb, Luke M. & Geweke, John & Taylor, Christopher T., 2006. "A variance screen for collusion," International Journal of Industrial Organization, Elsevier, vol. 24(3), pages 467-486, May.
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    More about this item

    Keywords

    competition; cartel detection; empirical screens.;
    All these keywords.

    JEL classification:

    • L41 - Industrial Organization - - Antitrust Issues and Policies - - - Monopolization; Horizontal Anticompetitive Practices
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • C40 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - General

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