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Macroeconomic Effects of Market Structure Distortions

Author

Listed:
  • Flavien Moreau

    (UCLA)

  • Ludovic Panon

    (Sciences Po)

Abstract

This paper develops a quantitative framework with heterogenous firms and endogenous markups to assess the macroeconomic implications of sectoral distortions to market structure, namely the existence of cartels. The direct negative welfare impact of cartels is compounded by increases in non-colluders’ prices (umbrella pricing). We then build a dataset on firm- and sector-level collusive cases constructed from the textual analysis of two decades of antitrust decisions taken by the French Competition Authority that we combine with exhaustive administrative firm microdata to test the predictions of our model.

Suggested Citation

  • Flavien Moreau & Ludovic Panon, 2019. "Macroeconomic Effects of Market Structure Distortions," 2019 Meeting Papers 579, Society for Economic Dynamics.
    • Handle: RePEc:red:sed019:579
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    References listed on IDEAS

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