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Collusive Compensation Schemes Aided by Algorithms

Martin, Simon; Schmal, Wolfgang Benedikt - 2021

Sophisticated collusive compensation schemes such as assigning future market shares or direct transfers are frequently observed in detected cartels. We show formally why these schemes are useful for dampening deviation incentives when colluding firms are temporary asymmetric. The relative...

Persistent link: https://www.econbiz.de/10013310765

Strategic Leaks in First-Price Auctions and Tacit Collusion : The Case of Spying and Counter-Spying

Fan, Cuihong; Chŏn, Pyŏng-hŏn; Wolfstetter, Elmar - 2021

We analyze strategic leaks due to spying out a rival’s bid in a first-price auction. Such leaks induce sequential bidding, complicated by the fact that the spy may be a counterspy who serves the interests of the spied at bidder and reports strategically distorted information. This ambiguity...

Persistent link: https://www.econbiz.de/10013231973

Preferential Trade Liberalization with Endogenous Cartel Discipline : Implications for Welfare and Optimal Trade Policies

Agnosteva, Delina - 2020

We consider an international cartel whose members interact repeatedly in their own as well as in third …-country segmented markets. Cartel discipline-an inverse measure of the degree of competition between firms-is endogenously determined by … the cartel's incentive compatibility constraint (ICC), which links strategically markets that are seemingly unrelated …

Persistent link: https://www.econbiz.de/10012822505

Conspiracy Against the Public Â€“ an Experiment on Collusion

Johnsen, Åshild A. - 2019

theory, while sociological theories of social ties and intergroup comparisons suggest that bilateral cooperation can be …

Persistent link: https://www.econbiz.de/10012892045

Gender and Collusion

Haucap, Justus; Heldman, Christina; Rau, Holger Andreas - 2022

Many cartels are formed by individual managers of different firms, but not by firms as collectives. However, most of the literature in industrial economics neglects individuals’ incentives to form cartels. Although oligopoly experiments reveal important insights on individuals acting as firms,...

Persistent link: https://www.econbiz.de/10013296722

How Communication Makes the Difference between a Cartel and Tacit Collusion : A Machine Learning Approach

Andres, Maximilian; Bruttel, Lisa Verena; Friedrichsen, Jana - 2022

This paper sheds new light on the role of communication for cartel formation. Using machine learning to evaluate free … cartel formation and indirect attempts to collude tacitly. We document that firms are less likely to communicate explicitly … sanctions on communication reinforces the direct cartel-deterring effect of sanctions as collusion is more difficult to reach …

Persistent link: https://www.econbiz.de/10014243096

A Q-Theory of Banks

Begenau, Juliane; Bigio, Saki; Majerovitz, Jeremy; … - 2021

We propose a dynamic bank theory with a delayed loss recognition mechanism and a regulatory capital constraint at its …

Persistent link: https://www.econbiz.de/10013323873

Optimal Firms's Dividend and Capital Structure for Mean Reverting Profitability

Menoncin, Francesco; Panteghini, Paolo M.; Regis, Luca - 2021

We model a risk-averse firm owner who wants to maximize the intertemporal expected utility of firm’s dividends. The optimal dynamic control problem is characterized by two stochastic state variables: the equity value, and profitability (ROA) of the _rm. According to the empirical evidence, we...

Persistent link: https://www.econbiz.de/10013314671

Advance-Purchase Financing of Projects with Few Buyers

Sahm, Marco - 2015

I investigate a simple model of advance-purchase contracts as a mode of financing costly projects. The analysis can easily be reinterpreted as a model of the monopolistic provision of excludable public goods under private information. An entrepreneur has to meet some capital requirement in order...

Persistent link: https://www.econbiz.de/10011388225

Taxes and the efficiency costs of capital distortions

Weichenrieder, Alfons J.; Klautke, Tina - 2008

departure from tax neutrality. Against this background, the present paper discusses the theory of capital structure and provides …

Persistent link: https://www.econbiz.de/10010277187