Cartel Stability with Time-dependent Detection Probabilities

Arbeitspapier

To account for the illegal nature of price-fixing agreements, detection probabilities are introduced in a dynamic oligopoly. It follows that for a trigger strategy to sustain a non-cooperative collusive equilibrium as a SPNE both the discount rate and all per-period detection probabilities have to be `low enough'. Also, the domain reduces for which strictest incentive compatibility constraint is binding of the concomitant non-stationary supergame if (i) any per-period detection probability increases, (ii) prospective fine payments are increased, (iii) the period of limitation is reduced for violating antitrust laws.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Tinbergen Institute Discussion Paper ; No. 03-104/1

Classification and Topics

• Classification: Wirtschaft ; Monopoly; Monopolization Strategies ; Monopolization; Horizontal Anticompetitive Practices
• Subject: Cartel stability ; trigger strategy ; detection probabilities ; period of limitation ; Kartell ; Oligopol ; Theorie

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Hinloopen, J.
• Event: Veröffentlichung
• (who): Tinbergen Institute
• (where): Amsterdam and Rotterdam
• (when): 2003

Further information

• Handle: http://hdl.handle.net/10419/86082
• Last update: 10.03.2025, 11:44 AM CET