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Motivated by recent cartel practices, a stable collusive agreement is characterized when firms' prices and quantities … and then make transfers within the cartel based on these reports. The properties of this equilibrium fit well with the … cartel agreements used in a number of markets including citric acid, lysine, and vitamins. …
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Commodity markets are characterized by large volumes of forward contracts as well as high volatility. They are often accused of weak competitive pressure. This article extends the existing literature by analyzing tacit collusion of firms, forward trading and volatility simultaneously. The...
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