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A note on collusion sustainability with optimal punishments and detection lags

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  • Ciarreta Antuñano, Aitor
  • Gutiérrez Hita, Carlos

Abstract

In this note we characterize optimal punishments with detection lags when the market consists of n oligopolistic firms. We extend a previous note by Colombo and Labrecciosa (2006) [Colombo, L., and Labrecciosa, P., 2006. Optimal punishments with detection lags. Economic Letters 92, 198-201] to show how in the presence of detection lags optimal punish- ments fail to restore cooperation also in markets with a low number of firms.

Suggested Citation

  • Ciarreta Antuñano, Aitor & Gutiérrez Hita, Carlos, 2008. "A note on collusion sustainability with optimal punishments and detection lags," DFAEII Working Papers 1988-088X, University of the Basque Country - Department of Foundations of Economic Analysis II.
    • Handle: RePEc:ehu:dfaeii:6611
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    References listed on IDEAS

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    3. Abreu, Dilip & Pearce, David & Stacchetti, Ennio, 1986. "Optimal cartel equilibria with imperfect monitoring," Journal of Economic Theory, Elsevier, vol. 39(1), pages 251-269, June.
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    5. Colombo, Luca & Labrecciosa, Paola, 2006. "Optimal punishments with detection lags," Economics Letters, Elsevier, vol. 92(2), pages 198-201, August.
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