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Market Shares as Collusive Marker: Evidence from the European Truck Industry

Author

Listed:
  • Bovin, Andreas
  • Bos, Iwan

    (RS: GSBE other - not theme-related research, Organisation,Strategy & Entrepreneurship)

Abstract

Collusion theory robustly predicts non-cartel rivals to raise their price and increase their output. As the typical cartel cuts back production, its competitors are expected to gain market share during the collusive period and to lose market share in the period following the cartel's demise. We provide empirical support for this prediction by showing that it applied to the European truck cartel. We also illustrate how our analysis can be used in the prosecution stage. One truck manufacturer denied cartel participation, whereas the proposed market share test supports the European Commission's finding that this firm was, in fact, a member.

Suggested Citation

  • Bovin, Andreas & Bos, Iwan, 2023. "Market Shares as Collusive Marker: Evidence from the European Truck Industry," Research Memorandum 011, Maastricht University, Graduate School of Business and Economics (GSBE).
    • Handle: RePEc:unm:umagsb:2023011
    DOI: 10.26481/umagsb.2023011
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General
    • L40 - Industrial Organization - - Antitrust Issues and Policies - - - General

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