This paper studies the effects of a further integration of markets that are characterized by intra-industry trade. The analysis is motivated by the observation that product markets of EU countries are more segmented than is usually supposed, which becomes evident e.g. from high differences in...

We examine how irreversible capital reduces the possibility of a duopoly to sustain implicit collusion by grim strategies, when the product is homogenous and firms compete in quantities. Compared with the case of reversible capital, there are two countervailing effects: Deviation from an...

A fluctuating exchange rate has an impact on how firms value a given stream of profits, thereby affecting the ability of an international oligopoly to collude implicitly. The conversion effect arises because the foreign firm maximizes its profits earned on the home market measured in foreign...

The aim of this paper is to summarize the theory of (implicit) collusion in the framework of infinitely repeated games, and in particular, to survey the comprehensive literature exploring which factors make collusion easier or more difficult to sustain. On this basis, the existing empirical...

This rejoinder responds to some issues raised in the comments to my survey on collusion. The focus is on different assumptions on the punishment phase and on some aspects of competition policy. Copyright Springer Science + Business Media, Inc. 2005