On collusion sustainability with stacked reversion
Date
2015-11-09
Journal Title
Journal ISSN
Volume Title
Publisher
Juraj Dobrila University of Pula
Fecha de fin de embargo
Redes Sociales
Citación
Citación APAAbstract
We consider a multi-period oligopoly model to analyze cartel sustainability where a subset of collusive firms is exogenously given. We assume that in case of cheating only the cheater is expelled from the cartel and collusion continues without the cheater. We show that, in our model, when firms compete in quantities and the cartel is sufficiently small, a Stackelberg leader cartel can always be sustained if firms are patient enough. Furthermore, in this case collusion is more easily sustained than when firms play grim trigger strategies. The opposite result is obtained in a price-setting supergame with differentiated products.
Description
Keywords
Collusion, Stacked reversion, Colusión, Reversión apilada, Trigger strategies, Estrategias de activación
Citation
Escrihuela-Villar, M., & Guillén, J. (2011). On collusion sustainability with stacked reversion. Economic Research-Ekonomska Istraživanja, 24(2), 89–98. https://doi.org/10.1080/1331677x.2011.11517458