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Free Competition Theory and the secret agreements between companies. Saint-Gobain under the charges of cartel

Author

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  • Andreas STAMATE

    () (Academy of Economic Studies, Romania)

Abstract

The European view of economic competition, which is the European Parliament view and enforced by the European Commission does not have a coherent theory of efficiency in allocating resources and justice on a market. The positive law proceeds at incriminating and penalizing with arbitrarily fixed fines the players on different markets but not offering a definition of what competition or free market means, not to mention a theory of the firm. It delivers, of course, a sort of theory, but we argue that it is not coherent and moreover, pretends to be what it cannot possible be, nam¬ely free of any value judgments. The present paper exposes an alternative view to the theory used by EC when decided to fine with 1.4 billion euros the European car glass suppliers Saint-Gobain, Pilkington, AGC and Soliver for cartelizing, and it also presents the case from the perspective of free competition theory based on private property rights of owners.

Suggested Citation

  • Andreas STAMATE, 2011. "Free Competition Theory and the secret agreements between companies. Saint-Gobain under the charges of cartel," Romanian Journal of Economics, Institute of National Economy, vol. 33(2(42)), pages 5-20, December.
  • Handle: RePEc:ine:journl:v:33:y:2011:i:42:p:5-20
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    More about this item

    Keywords

    cartel; secret agreement; welfare losses; free competition; property rights; competition public policy;

    JEL classification:

    • B53 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Austrian
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • P14 - Economic Systems - - Capitalist Systems - - - Property Rights

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