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behavior, at least one of these actors is always missing. By contrast, the present paper's oligopoly model includes all three …
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Non-controlling minority shareholdings in rivals (NCMS) lower the sustainability of collusion under a wide variety of circumstances. Nevertheless, NCMS are sometimes deemed to facilitate collusion, in particular if the level of NCMS is exogenous. The present paper endogenizes firms' choice of...
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We provide a theory of how RPM facilitate upstream cartels absent any information asymmetries using a model with … manufacturers if they collude. We thus provide a novel theory of harm for resale price maintenance when manufacturers collude and … illustrate the fit of this theory in various competition policy cases. …
Persistent link: https://www.econbiz.de/10012438202
The firms in this model set non-binding list prices before competing for buyers by non-cooperatively granting discounts. Each firm has an incentive to set a high list price if, for example, the customers anchor their willingness-to-pay on the list price. However, list price competition occurs if...
Persistent link: https://www.econbiz.de/10012314193
We provide a novel explanation for why manufacturers want to enforce a minimum resale price (min RPM) on retailers. A manufacturer sells her good via a multi-product retailer to final consumers by charging a linear wholesale price. The manufacturer then maximizes her profit through min RPM...
Persistent link: https://www.econbiz.de/10013328108
This paper analyzes the inner workings of cartels. To understand how sanctioning institutions prevent cartel formation we study their effect on firms' communication in a laboratory experiment. Using machine learning to organize the chat communication into topics, we find that firms are less...
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