This article studies the strategic interactions between cartelists and the antitrust agency in two theoretical game settings. In the simultaneous game, the numerical results show that it becomes harder for the firms to sustain collusion, but easier for the antitrust agency to detect collusion as...

A bidding ring is a collection of bidders who collude in an auction in order to gain greater surplus by depressing competition. This entry describes some typical bidding rings and provides an introduction to the related theoretical and empirical literature.

We develop a method to screen for local cartels. We first test whether there is statistical evidence of clustering of outlets that score high on some characteristic that is consistent with collusive behavior. If so, we determine in a second step the most suspicious regions where further...

This paper offers a cartel explanation for the stability of German collective bargaining institutions.We show that a dense net of legal safeguards has been yarned around the wage setting cartel. These measures make deviation by cartel insiders less attractive and simultaneously erect entry...

Antitrust law is the primary legal obstacle to price fixing, which is condemned by Section 1 of the Sherman Act. Firms that engage in price fixing may try to reduce their probability of antitrust liability in a number of ways. First, members of a price-fixing conspiracy go to great lengths to...

Triggered by the concentration process in the electricity and gas markets, the land of Hesse proposes to give the German cartel office power to divest dominant firms or oligopolies if this is necessary to restore competition. The paper shows that the reform would be in line with constitutional...

We examine whether cooperation in R&D leads to product market collusion. Suppose that firms engage in a stochastic R&D race while maintaining the collusive equilibrium in a repeated-game framework. Innovation under competitive R&D creates inter-firm asymmetries, which destabilizes the collusive...

A booming literature describes how artificial intelligence algorithms (AIAs) may autonomously learn to generate supra-competitive profits. Key to the widespread interpretation of the phenomena as ``collusion'', is the observation that the unilateral price cuts of an agent are followed by several...

This paper develops a model that formalizes several connections between mergers, collusion and competition policy. In equilibrium, firms may merge to make collusion sustainable when it cannot be sustained with the original set of firms. A rise in the probability of detecting and prosecuting...

We study optimal cartel prices in a two-sided market. We present a simple model showing that prices above the two-sided monopoly price may prevail on one side of a two-sided market as a means to enhance the sustainability of the cartel. We prove that in such a case a higher benefit from the...