Business Economics and Public Policy Papers

Document Type

Journal Article

Date of this Version

10-2011

Publication Source

American Economic Review

Volume

101

Issue

6

Start Page

2425

Last Page

2449

DOI

10.1257/aer.101.6.2425

Abstract

Motivated by recent cartel practices, a stable collusive agreement is characterized when firms' prices and quantities are private information. Conditions are derived whereby an equilibrium exists in which firms truthfully report their sales and then make transfers within the cartel based on these reports. The properties of this equilibrium fit well with the cartel agreements in a number of markets including citric acid, lysine, and vitamins.

Copyright/Permission Statement

Copyright © 1998, 1999, 2000, 2001, 2002, 2003, 2004, 2005, 2006, 2007, 2008, 2009, 2010, 2011, 2012, 2013, 2014, 2015, 2016, 2017, 2018 by the American Economic Association.

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Date Posted:08 September 2018

This document has been peer reviewed.