cooperation, undercutting is defection. Jointly, competitors are better off if both are faithful to a cartel. Individually, profit … is highest if only the competitor(s) is (are) loyal to the cartel. Yet collusion inflicts harm on the opposite market … expected. -- Oligopoly ; Collusion ; experiment ; Uncertainty ; negative externalities ; prisoner's dilemma …

difficult to sustain, as discriminating between random demand shocks and marginal deviations from the cartel strategy becomes …