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The distribution of harm in price-fixing cases

  • Boone, Jan
  • Müller, Wieland

We consider a vertically related industry and analyze how the total harm due to a price increase upstream is distributed over downstream firms and final consumers. For this purpose, we develop a general model without making specific assumptions regarding demand, costs, or the mode of competition. We consider both the case of homogeneous and differentiated goods markets, and illustrate how basic intuition from the tax incidence literature carries over to the distribution of harm. Furthermore, we discuss data requirements and suggest explicit formulas and regression specifications that can be used to estimate the relevant terms in the harm distribution in practice.

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Article provided by Elsevier in its journal International Journal of Industrial Organization.

Volume (Year): 30 (2012)
Issue (Month): 2 ()
Pages: 265-276

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Handle: RePEc:eee:indorg:v:30:y:2012:i:2:p:265-276
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