The paper considers tacit collusion in markets which are not fully transparent on both sides. Consumers only detect prices with some probability before deciding which fi?rm to purchase from, and each fi?rm only detects the other fi?rm's price with some probability. Increasing transparency on the...

In a Hotelling market with endogenous choice of product characteristics increasing market transparency on the consumer side leads to less product differentiation, and lower prices and profits. This is welfare improving for all consumers and total surplus increases.

This paper investigates the effects on tacit collusion of increased market transparency on the consumer side as well as on the producer side of a market. Increasing market transparency on the consumer side, increases the benefits to a firm from undercutting the collusive price. It also decreases...

We study the long run e¤ects of transparency in a circular town model of a differentiated market. The market is not fully transparent on the consumer side: A fraction of consumers are uninformed about prices. Increasing transparency reduces the equilibrium price, profit and entry of firms. This...

We provide an extensive and general investigation of the effects on industry performance (profits and social welfare) of exogenously changing the number of firms in a Cournot framework. This amounts to an in-depth exploration of the well-known trade-off between competition and production...

Danish ready-mixed concrete is produced in regional oligopolies. Firms rely on price discrimination through secret discounts. The antitrust authority interprets this as lack of competition and has decided to activate its chief weapon against dormant competition: To make the market more...

The consequences for market performance of publicity of anticompetitive behaviour and prohibition of anticompetitive behaviour combined with punishment of violators are compared, in a model that also allows for the possibility of entry. Implications for Danish and for international competitive...

This paper considers the effect of monopoly-promoting export cartels on domestic production. It is argued that export cartels facilitate tacit collusion by monitoring defections more efficiently. This slackesn the incentive constraint of tacit collusion. Optimizing firms competing both in the...

In several European merger cases competition authorities have demanded that the merging firm auctions of virtual capacity. The buyer of virtual capacity receives an option on an amount of output at a pre-specified price, typically equal to marginal cost. This output is sold in the market in...

We characterize the interplay between firms’ decision in terms of product standardization and the nature of their ensuing market behaviour. We prove the existence of a non-monotone relationship between firms’ decision at the product stage and their intertemporal preferences.