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Anatomy of the Rise and Fall of a Price-Fixing Conspiracy: Auctions at Sotheby's and Christie's

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Author Info
Ashenfelter, Orley C
Graddy, Kathryn

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Abstract

The Sotheby’s/Christie’s price-fixing scandal that ended in the public trial of Alfred Taubman provides a unique window on a number of key economic and antitrust policy issues related to the use of the auction system. The trial provided detailed evidence as to how the price fixing worked, and the economic conditions under which it was started and began to fall apart. The outcome of the case also provides evidence on the novel auction process used to choose the lead counsel for the civil settlement. Finally, though buyers received the bulk of the damages, a straightforward application of the economic theory of auctions shows that it is unlikely that successful buyers as a group were injured.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 4662.

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Date of creation: Oct 2004
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Handle: RePEc:cpr:ceprdp:4662

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Related research
Keywords: auctions; cartels; commissions; price-fixing;

Other versions of this item:

Find related papers by JEL classification:
D44 - Microeconomics - - Market Structure and Pricing - - - Auctions
K21 - Law and Economics - - Regulation and Business Law - - - Antitrust Law
L41 - Industrial Organization - - Antitrust Issues and Policies - - - Monopolization; Horizontal Anticompetitive Practices

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Mukesh Eswaran, 1997. "Cartel Unity over the Business Cycle," Canadian Journal of Economics, Canadian Economics Association, vol. 30(3), pages 644-72, August. [Downloadable!] (restricted)
  2. Orley Ashenfelter & Kathryn Graddy, 2003. "Auctions and the Price of Art," Journal of Economic Literature, American Economic Association, vol. 41(3), pages 763-787, September.
    Other versions:
  3. GINSBURGH, Victor & LEGROS, Patrick & SAHUGUET, Nicolas, 2005. "How to win twice at an auction," CORE Discussion Papers 2005005, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE). [Downloadable!]
  4. Victor Ginsburgh & Patrick Legros & Nicolas Sahuguet, 2004. "How to Win Twice at an Auction. On the Incidence of Commissions in Auction Markets," Working Papers 2004.146, Fondazione Eni Enrico Mattei. [Downloadable!]
    Other versions:
  5. Posner, Richard A, 1970. "A Statistical Study of Antitrust Enforcement," Journal of Law & Economics, University of Chicago Press, vol. 13(2), pages 365-419, October.
  6. Green, Edward J & Porter, Robert H, 1984. "Noncooperative Collusion under Imperfect Price Information," Econometrica, Econometric Society, vol. 52(1), pages 87-100, January. [Downloadable!] (restricted)
    Other versions:
  7. Margaret C. Levenstein & Valerie Y. Suslow, 2002. "What Determines Cartel Success?," Working Papers 2002-01, University of Massachusetts Amherst, Department of Economics. [Downloadable!]
  8. Ashenfelter, Orley, 1989. "How Auctions Work for Wine and Art," Journal of Economic Perspectives, American Economic Association, vol. 3(3), pages 23-36, Summer. [Downloadable!] (restricted)
  9. Robert H. Porter, 1983. "A Study of Cartel Stability: The Joint Executive Committee, 1880-1886," Bell Journal of Economics, The RAND Corporation, vol. 14(2), pages 301-314, Autumn. [Downloadable!] (restricted)
  10. Rotemberg, Julio J & Saloner, Garth, 1986. "A Supergame-Theoretic Model of Price Wars during Booms," American Economic Review, American Economic Association, vol. 76(3), pages 390-407, June. [Downloadable!] (restricted)
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Joseph E. Harrington, Jr, 2006. "How Do Cartels Operate?," Economics Working Paper Archive 531, The Johns Hopkins University,Department of Economics. [Downloadable!]
  2. Calin Valsan & Robert Sproule, 2008. "Reservation Prices And Pre-Auction Estimates: A Study In Abstract Art," The AMFITEATRU ECONOMIC journal, Academy of Economic Studies - Bucharest, Romania, vol. 10(24), pages 257-272, June. [Downloadable!]
  3. Robert Porter, 2005. "Detecting Collusion," Review of Industrial Organization, Springer, vol. 26(2), pages 147-167, December. [Downloadable!] (restricted)
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