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Export cartels and domestic markets

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Author Info
Christian Schultz (Institute of Economics, University of Copenhagen)

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Abstract

This paper considers the effect of monopoly-promoting export cartels on domestic production. It is argued that export cartels facilitate tacit collusion by monitoring defections more efficiently. This slackesn the incentive constraint of tacit collusion. Optimizing firms competing both in the domestic and export markets will often use the icnreased possiblity for collusion in both markets. A condition is given under which this is the case.

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File URL: http://www.econ.ku.dk/CIE/Discussion%20Papers/1999/Pdf%20files/9904.pdf
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Publisher Info
Paper provided by University of Copenhagen. Department of Economics. Centre for Industrial Economics in its series CIE Discussion Papers with number 1999-04.

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Length: 24 pages
Date of creation: Feb 1999
Date of revision:
Publication status: Published in: Journal of Industry, Competition and Trade 2(3), 223-246, 2002
Handle: RePEc:kud:kuieci:1999-04

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Related research
Keywords: export cartels; tacit collusion; multimarket contact;

Find related papers by JEL classification:
L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
L40 - Industrial Organization - - Antitrust Issues and Policies - - - General

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. Dick, Andrew R, 1996. "When Are Cartels Stable Contracts?," Journal of Law & Economics, University of Chicago Press, vol. 39(1), pages 241-83, April.
  2. Farrell, Joseph & Shapiro, Carl, 1990. "Horizontal Mergers: An Equilibrium Analysis," American Economic Review, American Economic Association, vol. 80(1), pages 107-26, March. [Downloadable!] (restricted)
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  3. Schmidt, Klaus M. & Schnitzer, Monika, 1995. "The interaction of explicit and implicit contracts," Economics Letters, Elsevier, vol. 48(2), pages 193-199, May. [Downloadable!] (restricted)
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  4. B. Douglas Bernheim & Michael D. Whinston, 1990. "Multimarket Contact and Collusive Behavior," RAND Journal of Economics, The RAND Corporation, vol. 21(1), pages 1-26, Spring. [Downloadable!] (restricted)
  5. Farrell, Joseph & Maskin, Eric, 1989. "Renegotiation in repeated games," Games and Economic Behavior, Elsevier, vol. 1(4), pages 327-360, December. [Downloadable!] (restricted)
    Other versions:
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