Rebels without a clue? Experimental evidence on partial cartels

Arbeitspapier

This paper provides experimental evidence on the formation of partial cartels with endogenous coordination. Firms face a coordination challenge when a partial cartel is to be formed as every firm is better off if it is not inside the cartel but is a free-riding outsider. We introduce a three-stage mechanism with communication which facilitates the formation of a cartel and respectively allows the formation of a partial cartel. All-inclusive cartels are always formed. We find that partial cartels are frequently rejected out-of-equillibrium if moutside firms profit excessively from the formation of the cartel.

Object Details

• ISBN: 978-3-86304-068-0
• Language: Englisch

References and Relationships

• Bibliographic citation: Series: DICE Discussion Paper ; No. 69

Classification and Topics

• Classification: Wirtschaft ; Design of Experiments: Laboratory, Group Behavior ; Institutions: Design, Formation, Operations, and Impact ; Monopolization; Horizontal Anticompetitive Practices
• Subject: Partial Cartels ; Coordination ; Communication ; Experiment

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Clemens, Georg ; Rau, Holger A.
• Event: Veröffentlichung
• (who): Heinrich Heine University Düsseldorf, Düsseldorf Institute for Competition Economics (DICE)
• (where): Düsseldorf
• (when): 2013

Further information

• Handle: http://hdl.handle.net/10419/71291
• Last update: 10.03.2025, 11:44 AM CET