Cartel overcharges: An empirical analysis
Using 406 overcharge estimates, the study analyzes the impact of cartel characteristics and the market environment on the magnitude of overcharges attained by cartels in different geographic markets and during six antitrust law regimes starting from the 18th century. The median overcharge achieved by cartels is 20 percent of selling price. As predicted by cartel theory, market structure is an important determinant of the overcharge level. Markets where cartels have high market shares tend to have higher overcharges. The number of cartel participants and the size inequality among them are inversely related to the overcharge level. International cartels impose higher overcharges than domestic cartels. Overcharges attained in the US and European markets tend to be lower than overcharges achieved in the Asian markets and the rest of the world. Results on the impact of changes in the antitrust law environment over time on the size of cartel overcharges are mixed. However, there is some evidence indicating that the lowest overcharges are associated with the latest antitrust law period.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
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.:
- Connor, John M. & Bolotova, Yuliya, 2006. "Cartel overcharges: Survey and meta-analysis," International Journal of Industrial Organization, Elsevier, vol. 24(6), pages 1109-1137, November.
- Froeb, Luke M. & Koyak, Robert A. & Werden, Gregory J., 1993.
"What is the effect of bid-rigging on prices?,"
Elsevier, vol. 42(4), pages 419-423.
- Margaret Levenstein, 1993.
"Price Wars and the Stability of Collusion: A Study of the Pre-World War I Bromine Industry,"
NBER Historical Working Papers
0050, National Bureau of Economic Research, Inc.
- Levenstein, Margaret C, 1997. "Price Wars and the Stability of Collusion: A Study of the Pre-World War I Bromine Industry," Journal of Industrial Economics, Wiley Blackwell, vol. 45(2), pages 117-37, June.
- Madhavan, Ananth N & Masson, Robert T & Lesser, William H, 1994. "Cooperation for Monopolization? An Empirical Analysis of Cartelization," The Review of Economics and Statistics, MIT Press, vol. 76(1), pages 161-75, February.
- Bryant, Peter G & Eckard, E Woodrow, Jr, 1991. "Price Fixing: The Probability of Getting Caught," The Review of Economics and Statistics, MIT Press, vol. 73(3), pages 531-36, August.
- repec:cup:cbooks:9780521623940 is not listed on IDEAS
- David Genesove & Wallace P. Mullin, 2001.
"Rules, Communication, and Collusion: Narrative Evidence from the Sugar Institute Case,"
American Economic Review,
American Economic Association, vol. 91(3), pages 379-398, June.
- David Genesove & Wallace P. Mullin, 2001. "Rules, Communication and Collusion: Narrative Evidence from the Sugar Institute Case," NBER Working Papers 8145, National Bureau of Economic Research, Inc.
- Genesove, David & Mullin, Wallace P, 2001. "Rules, Communication and Collusion: Narrative Evidence from the Sugar Institute Case," CEPR Discussion Papers 2739, C.E.P.R. Discussion Papers.
- Dick, Andrew R, 1996. "When Are Cartels Stable Contracts?," Journal of Law and Economics, University of Chicago Press, vol. 39(1), pages 241-83, April.
- Fernando Vega-Redondo, 1997.
"The Evolution of Walrasian Behavior,"
Econometric Society, vol. 65(2), pages 375-384, March.
- Posner, Richard A, 1970. "A Statistical Study of Antitrust Enforcement," Journal of Law and Economics, University of Chicago Press, vol. 13(2), pages 365-419, October.
- Yuliya Bolotova & John M. Connor & Douglas J. Miller, 2007. "Factors influencing the magnitude of cartel overcharges: An empirical analysis of food-industry cartels," Agribusiness, John Wiley & Sons, Ltd., vol. 23(1), pages 17-33.
- Hay, George A & Kelley, Daniel, 1974. "An Empirical Survey of Price Fixing Conspiracies," Journal of Law and Economics, University of Chicago Press, vol. 17(1), pages 13-38, April.
- Valerie Y. Suslow, 2005. "Cartel contract duration: empirical evidence from inter-war international cartels," Industrial and Corporate Change, Oxford University Press, vol. 14(5), pages 705-744, October.
- Svend Albæk & Peter Møllgaard & Per Baltzer Overgaard, 1997.
"Government-Assisted Oligopoly Coordination? A Concrete Case,"
CIE Discussion Papers
1997-03, University of Copenhagen. Department of Economics. Centre for Industrial Economics.
- Albaek, Svend & Mollgaard, Peter & Overgaard, Per B, 1997. "Government-Assisted Oligopoly Coordination? A Concrete Case," Journal of Industrial Economics, Wiley Blackwell, vol. 45(4), pages 429-43, December.
- John Connor, 2001. "“Our Customers Are Our Enemies”: The Lysine Cartel of 1992–1995," Review of Industrial Organization, Springer, vol. 18(1), pages 5-21, February.
- Connor, John M., 2005. "Price-Fixing Overcharges: Legal And Economic Evidence," 2005 Annual meeting, July 24-27, Providence, RI 19254, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
When requesting a correction, please mention this item's handle: RePEc:eee:jeborg:v:70:y:2009:i:1-2:p:321-341. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei)
If references are entirely missing, you can add them using this form.