American Economic Journal:
Microeconomics
ISSN 1945-7669 (Print) | ISSN 1945-7685 (Online)
Collusion with Asymmetric Retailers: Evidence from a Gasoline Price-Fixing Case
American Economic Journal: Microeconomics
vol. 5,
no. 3, August 2013
(pp. 97–123)
Abstract
We point out a fundamental difficulty of successfully colluding in retail markets with heterogeneous fi rms, and characterize the mechanism recent gasoline cartels in Canada used to sustain collusion. Heterogeneity in cost and network size necessitates arrangements whereby participants split the market unequally to favor stronger players. We characterize empirically the strategy and transfer mechanism using court documents containing summaries and extracts of conversations between participants. The mechanism implements transfers based on adjustment delays during price changes. We estimate that these delays can translate into substantial transfers and provide examples in which they can substantially reduce deviation frequency.Citation
Clark, Robert, and Jean-François Houde. 2013. "Collusion with Asymmetric Retailers: Evidence from a Gasoline Price-Fixing Case." American Economic Journal: Microeconomics, 5 (3): 97–123. DOI: 10.1257/mic.5.3.97Additional Materials
JEL Classification
- K21 Antitrust Law
- L12 Monopoly; Monopolization Strategies
- L71 Mining, Extraction, and Refining: Hydrocarbon Fuels
- L81 Retail and Wholesale Trade; e-Commerce
There are no comments for this article.
Login to Comment