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Do antitrust agencies facilitate meetings in smoke-filled rooms?

Author

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  • Bos, I.

    (Organisation,Strategy & Entrepreneurship)

  • Pot, E.A.

    (Quantitative Economics)

  • Peeters, R.J.A.P.

    (Microeconomics & Public Economics)

Abstract

This article identifies a potential adverse effect of antitrust enforcement. We show that if tacit collusion is not sustainable, firms are able and willing to collude explicitly when demand is viscous, the expected antitrust penalty is limited and antitrust agencies are sufficiently effective in catching cartels.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Bos, I. & Pot, E.A. & Peeters, R.J.A.P., 2010. "Do antitrust agencies facilitate meetings in smoke-filled rooms?," Research Memorandum 030, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
    • Handle: RePEc:unm:umamet:2010030
    DOI: 10.26481/umamet.2010030
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    References listed on IDEAS

    as
    1. Motta,Massimo, 2004. "Competition Policy," Cambridge Books, Cambridge University Press, number 9780521016919, September.
    2. Joseph E. Harrington & Andrzej Skrzypacz, 2011. "Private Monitoring and Communication in Cartels: Explaining Recent Collusive Practices," American Economic Review, American Economic Association, vol. 101(6), pages 2425-2449, October.
    3. Martin, Stephen, 2006. "Competition policy, collusion, and tacit collusion," International Journal of Industrial Organization, Elsevier, vol. 24(6), pages 1299-1332, November.
    4. Ola Andersson & Erik Wengström, 2007. "Do Antitrust Laws Facilitate Collusion? Experimental Evidence on Costly Communication in Duopolies," Scandinavian Journal of Economics, Wiley Blackwell, vol. 109(2), pages 321-339, June.
    5. Paul Klemperer, 1995. "Competition when Consumers have Switching Costs: An Overview with Applications to Industrial Organization, Macroeconomics, and International Trade," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 62(4), pages 515-539.
    6. McCutcheon, Barbara, 1997. "Do Meetings in Smoke-Filled Rooms Facilitate Collusion?," Journal of Political Economy, University of Chicago Press, vol. 105(2), pages 330-350, April.
    7. David Genesove & Wallace P. Mullin, 2001. "Rules, Communication, and Collusion: Narrative Evidence from the Sugar Institute Case," American Economic Review, American Economic Association, vol. 91(3), pages 379-398, June.
    8. Stephen Davies & Matthew Olczak, 2008. "Tacit versus Overt Collusion Firm Asymmetries and Numbers: What's the Evidence?," Working Paper series, University of East Anglia, Centre for Competition Policy (CCP) 2008-32, Centre for Competition Policy, University of East Anglia, Norwich, UK..
    9. Stephen Davies & Matthew Olczak, 2008. "Tacit vs. Overt Collusion Firm Asymmetries and Numbers: What's the Evidence?," CPI Journal, Competition Policy International, vol. 4.
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    Cited by:

    1. Bos Iwan & Letterie Wilko & Vermeulen Dries, 2015. "Antitrust as Facilitating Factor for Collusion," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 15(2), pages 797-814, April.
    2. Iwan Bos & Ronald Peeters & Erik Pot, 2017. "Competition versus collusion: The impact of consumer inertia," International Journal of Economic Theory, The International Society for Economic Theory, vol. 13(4), pages 387-400, December.
    3. Wenzel, Tobias, 2024. "Collusion, inattentive consumers and shrouded prices," Journal of Economic Behavior & Organization, Elsevier, vol. 218(C), pages 579-591.

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