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Do antitrust agencies facilitate meetings in smoke-filled rooms?

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  • Iwan Bos
  • Ronald Peeters
  • Erik Pot

Abstract

This article identifies a potential adverse effect of antitrust enforcement. We show that if tacit collusion is not sustainable, firms are able and willing to collude explicitly when demand is viscous, the expected antitrust penalty is limited and antitrust agencies are sufficiently effective in catching cartels.

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File URL: http://hdl.handle.net/10.1080/13504851.2012.725925
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Bibliographic Info

Article provided by Taylor & Francis Journals in its journal Applied Economics Letters.

Volume (Year): 20 (2013)
Issue (Month): 6 (April)
Pages: 611-614

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Handle: RePEc:taf:apeclt:v:20:y:2013:i:6:p:611-614

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  1. McCutcheon, Barbara, 1997. "Do Meetings in Smoke-Filled Rooms Facilitate Collusion?," Journal of Political Economy, University of Chicago Press, vol. 105(2), pages 330-50, April.
  2. Ola Andersson & Erik Wengström, 2007. "Do Antitrust Laws Facilitate Collusion? Experimental Evidence on Costly Communication in Duopolies," Scandinavian Journal of Economics, Wiley Blackwell, vol. 109(2), pages 321-339, 06.
  3. Klemperer, Paul, 1995. "Competition When Consumers Have Switching Costs: An Overview with Applications to Industrial Organization, Macroeconomics, and International Trade," Review of Economic Studies, Wiley Blackwell, vol. 62(4), pages 515-39, October.
  4. Martin, Stephen, 2006. "Competition policy, collusion, and tacit collusion," International Journal of Industrial Organization, Elsevier, vol. 24(6), pages 1299-1332, November.
  5. Stephen Davies & Matthew Olczak, 2008. "Tacit versus Overt Collusion Firm Asymmetries and Numbers: What’s the Evidence?," Working Papers 08-32, Centre for Competition Policy, University of East Anglia.
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