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Corrigendum to "Forward trading and collusion in oligopoly" [J. Econ. Theory 131 (1) (2006) 212-230]

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  • Ressner, Ludwig
  • Liski, Matti
  • Montero, Juan-Pablo

Abstract

We consider an infinitely-repeated oligopoly in which at each period firms not only serve the spot market by either competing in prices or quantities but also have the opportunity to trade forward contracts. Contrary to the pro-competitive results of finite-horizon models, we find that the possibility of forward trading allows firms to sustain collusive profits that otherwise would not be possible. The result holds both for price and quantity competition and follows because (collusive) contracting of future sales is more effective in deterring deviations from the collusive plan than in inducing the previously identified pro-competitive effects.
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(This abstract was borrowed from another version of this item.)

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  • Ressner, Ludwig & Liski, Matti & Montero, Juan-Pablo, 2010. "Corrigendum to "Forward trading and collusion in oligopoly" [J. Econ. Theory 131 (1) (2006) 212-230]," Journal of Economic Theory, Elsevier, vol. 145(6), pages 2496-2497, November.
    • Handle: RePEc:eee:jetheo:v:145:y:2010:i:6:p:2496-2497
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    Cited by:

    1. Walsh, Darragh & Malaguzzi Valeri, Laura & Di Cosmo, Valeria, 2016. "Strategic bidding, wind ownership and regulation in a decentralised electricity market," MPRA Paper 71502, University Library of Munich, Germany.

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