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Tacit collusion, firm asymmetries and numbers: evidence from EC merger cases

Author

Listed:
  • Stephen Davies

    (Centre for Competition Policy and School of Economics, University of East Anglia)

  • Matthew Olczak

    (Aston Business School, Aston University)

  • Heather Coles

Abstract

This paper estimates the implicit model, especially the roles of size asymmetries and ï¬ rm numbers, used by the European Commission to identify mergers with coordinated effects. This subset of cases offers an opportunity to shed empirical light on the conditions where a Com-petition Authority believes tacit collusion is most likely to arise. We ï¬ nd that, for the Commission, tacit collusion is a rare phenomenon, largely conï¬ ned to markets of two, more or less symmetric, players. This is consistent with recent experimental literature, but contrasts with the facts on 'hard-core' collusion in which ï¬ rm numbers and asymmetries are often much larger.

Suggested Citation

  • Stephen Davies & Matthew Olczak & Heather Coles, 2007. "Tacit collusion, firm asymmetries and numbers: evidence from EC merger cases," Working Paper series, University of East Anglia, Centre for Competition Policy (CCP) 2007-07, Centre for Competition Policy, University of East Anglia, Norwich, UK..
    • Handle: RePEc:uea:ueaccp:2007_07
    as

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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Tacit collusion; collective dominance; coordinated effects; European mergers; asymmetries;
    All these keywords.

    JEL classification:

    • 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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