Internal cartel stability with time-dependent detection probabilities

To account for the illegal nature of price-fixing agreements, per-period detection probabilities that can vary over time are introduced in a dynamic oligopoly. The resulting ICCs for internal cartel stability indicate that for discount factors up to 10% per-period detection probabilities of 5% are needed to reduce the number of cartel members by 50%. For the special case of stationary supergames with constant per-period detection probabilities p elegant rules emerge: internal cartel stability requires the discount factor to increase with 100 × p / (1 − p) percent while a fixed fine of 100 × (1 − p) / p percent of incremental cartel profits is required for making the ICC always binding.     

On optimal cartel deterrence policies

This paper studies audit policies designed to deter explicit cartels in the most effective way. We first compare a standard random and stationary audit strategy with a simple deterministic but non stationary strategy; we show that the certainty of an ulterior control may better deter collusion than the recurrent threat of a sword of Damocles that would lead on average to same frequency of audit.We then explore more complex non stationary strategies and show that it is theoretically possible to deter collusion in the whole economy, even with a small audit budget.     

Economic efficiency,antitrust and rate-of-return

This paper examines the economic consequences of using excessive rates-of-return to detect and prosecute cartels. We find that this policy leads to inefficient factor utilization, but always increases output and welfare. The rate-of-return policy may yield greater social gains than a welfare-based antitrust policy.     

The bakers of Washington cartel: Twenty-five years later

Craig M. Newmark challenges the findings of a 1965 Federal Trade Commission decision and Economic Report that a price fixing cartel increased bread prices in the state of Washington from the mid-1950s to 1964. Newmark believes prices were higher during the cartel's existence because retailers in the west had higher margins and that bakers in the west had higher wages and higher normal profits than elsewhere in the country. Newmark ignores evidence that the cartel had set the higher retailer margins in Washington and that the labor costs and profits of Washington bakers were not higher than elsewhere. The Washington bakers had inflated distribution costs and excess capacity prior to the cartel's breakup. This result is commonplace when a cartel stimulates costly nonprice competition, so that the higher prices of the cartel members end up primarily in higher unit cost. Finally, Newmark claims that the reason prices fell in 1965 was the entry of a significant size price cutter, not the demise of the cartel. What Newmark characterized as a principal entrant was actually a tiny, two-man operation, with less than a 1.0 percent market share. The record shows that this entrant did not trigger the precipitous price decline occuring when the cartel was destroyed.     

Variations in antitrust enforcement activity

The purpose of this study is two-fold:

1. To describe the temporal pattern of general antitrust activity, often in a multivariate regression framework, over the years that Richard A. Posner observed (1890–1969) as well as for the subsequent years (1970–1982). We focus not on supplying of data or accounting for the number and types of cases als Posner, but to advance and test hypotheses about the causes and consequences of enforcement patterns.
2. To compare the relative temporal antitrust activity of the individual enforcement groups of DOJ, FTC, and private party plaintiffs (PPP) as measured by the number of cases filed.

     

Carve-outs under airline antitrust immunity

This paper offers the first formal economic analysis of carve-outs under airline antitrust immunity. Carve-outs are designed to limit the potential anticompetitive effects of cooperation by alliance partners in hub-to-hub markets, where they provide overlapping nonstop service. While the paper shows that carve-outs are beneficial when the alliance does not involve full integration of the partners' operations on the hub-to-hub route, its key point is that a carve-out may be harmful when imposed on a joint-venture alliance. A JV alliance involves full exploitation of economies of traffic density on the hub-to-hub route, and a carve-out prevents the realization of these benefits. While a carve-out may limit anticompetitive incentives on the hub-to-hub route, welfare may be reduced if the resulting gains are overshadowed by the efficiency loss generated by the carve-out.     

Exports and antitrust: Complements or substitutes?

Conflicting arguments have recently been voiced concerning the impact of antitrust statutes on the export performance of U.S. industries. On the one hand, opponents of vigorous enforcement have argued that antitrust constraints prevent firms from achieving efficiencies, thereby hampering competitiveness on world markets. On the other hand, proponents of antitrust have argued that vigorous enforcement tempers monopolistic pricing, thereby improving export performance. This paper presents an empirical test of these competing arguments. Our results indicate that Sherman Act Section 1 (price-fixing) enforcement has a positive effect on export shares, while Clayton Act Section 7 (merger) enforcement appears to have a negative effect.     

德国设计师借鉴玩具打造磁力概念车

相信很多人小时候玩过轨道赛车,那种纵横驰骋的感觉令人无比惬意。德国设计师克里斯蒂安弗尔格便借鉴这种玩具车,设计出一款借助磁力的概念车。     

The antitrust implications of electronic business-to-business marketplaces

Electronic marketplaces (e-marketplaces) allow networks of buyers and sellers to conduct business online and to exchange information more efficiently using Internet technology. Despite the benefits that e-marketplaces potentially afford firms, concerns have been raised that these markets may damage competition and potentially violate antitrust laws. This study considers the antitrust legislation related to e-marketplaces and examines the possible antitrust concerns that they raise. Potentially anticompetitive features of e-marketplaces are examined and guidance for firm conduct when creating or participating in an e-marketplace is offered.     

An antitrust analysis of bundled loyalty discounts

Consider a monopolist in one market that faces competition in a second market. Bundled loyalty discounts, in which customers receive a price break on the monopoly good in exchange for making all purchases from the monopolist, have ambiguous welfare effects. Such discounts should not always be treated as a form of predatory pricing. In some settings, they act as tie-in sales. Existing tests for whether such discounts violate competition laws do not track changes in consumer surplus or total surplus. We apply a new test to an illustrative example based on SmithKline that assumes the “tied” market has homogeneous goods. If the tied market is characterized by Hotelling competition, bundling by the monopolist causes the rival firm to reduce its price. In numerical examples, we find that this can deter entry or induce exit.     

制裁解除以来的利比亚油气国际合作

利比亚是非洲重要的产油国,石油勘探程度低,开发潜力巨大.国际制裁于2003年解除后,利比亚明确提出其石油工业宏伟发展目标,其油气国际合作面临诸多机会.依据第四版勘探和产品分成协议(EPSA Ⅳ),利比亚先后举行了4轮油气勘探许可证招标.全球石油公司纷纷参与竞标,竞争非常激烈.利比亚国家石油公司积极推动合作方多元化战略,以EPSA Ⅳ为基础,大幅提高本国收益,同时注意提升本国油气储量和资源潜力.中国企业在防范风险的同时.应加强与利比亚的油气合作,拓展思路,利用多种渠道扩大合作;重视各个方向的投资,制定有针对性的投资策略;健全合作方式、保护自身权益;积极履行社会责任,树立良好的企业形象.     

Discussion of exports and antitrust: Complements or substitutes?

The increasing international openness of the U.S. economy should provide a strong impetus for industrial organization economists to turn their attentions to international trade and investment. The study by Clark, et al. is a bold attempt to address the positive economics of a vexing policy issue that lies in the nexus of domestic competition and foreign trade. Their results do not yet provide a confident basis for policy-setting, but the paper is a promising start for the search for empirical regularities.     

Market dominance under U.S. antitrust

Much has transpired since Walter Adams and Horace Gray warned in 1955 about the dangers of state creation of monopoly. The dangers remain the same. But mainstream researchers have led the efforts for deregulation in railroads, airlines, gas and electric utilities, stock markets, banking, and other markets. Chicago-UCLA doctrines have played a part in the 1980s, but they have often run to excess, in advocating deregulation at any cost. One result of that approach has been the savings and loan scandal of the 1980s, where a wholesale removal of all restraints led to unforeseen economic damage.Also among the mainstream instruments, Section 2 has been applied to reduce market dominance in a number of important industries. Section 2 will continue to be only one tool for reducing market power, but it can be important. A renunciation of such an effective instrument is unwise. By helping to lead the mainstream critique of monopoly, Walter Adams has added to important policy actions. The policy-oriented tradition in the profession has been enriched by his skill and erudition.     

Efficiency gains and myopic antitrust authority in a dynamic merger game

This paper models a sequential merger formation game with endogenous efficiency gains in which every merger has to be submitted for approval to the Antitrust Authority (AA). Two different types of AA are studied: first, a myopic AA, which judges a given merger without considering that subsequent mergers may occur; and, second, a forward looking AA, which anticipates the ultimate market structure a given merger will lead to. By contrasting the decisions of these two types of AA, merger policy implications can be drawn. In particular, the efficiency offence argument does not find any justification under a forward looking AA.     

深度制裁下的伊朗政局走向

当前,以美国为代表的西方国家对伊朗步步紧逼,伊朗所处的国内外环境日趋严峻。国内政治经济形势面临前所未有的挑战:石油收入下降、物资供应短缺、汇率大幅跳水、神权地位下降、派系斗争升级。从短期看,美以对伊朗动武的可能性不大,以压促变仍是首选,美国将力图通过制裁、分化内部推翻伊朗反美政权。但伊朗是神权国家,也是一个比较民主的国家,其体制对革命存在一定的免疫性,而且民众对政府不满,可通过公开抗议、游行或投票选举等方式来表达。目前,哈梅内伊执政地位仍较稳固,虽然体制内的派系斗争可能在总统大选临近时升级,但因大选发生革命的可能性不大。从长期看,如果西方经济制裁持续加码,伊朗国内经济、社会形势可能进一步恶化,改革将成为民心所向,原来的改革派可能与新的政治势力结合,从体制内改革转入体制外抗争,进而推动伊朗神权体制外的民主变革。     

违规塑料玩具充斥市场需加大处罚力度

中广网北京3月25日消息据经济之声《天天315））报道,很多废弃的塑料制品甚至是医疗垃圾经过简单的回收处理之后居然就变成了孩子手里玩的、嘴里咬的各类的玩具,这样的既没有生产厂家也没有生产厂商的地址,有的甚至是连产品认证都不全的玩具,是怎么样流人市场的,用垃圾制成的材又会给孩子带来什么样的危害？     

The Australian antitrust law after 20 years — a stocktake

The Australian Trade Practices Act 1974 is a court-centered law of the American type. After 20 years it has much to its credit — the abandonment of cartelization and the achievement of a coherent body of antitrust law focused upon market power as the central concept. The law has some distinctive features: the approach to market definition; the possibility of authorization on grounds of public benefit; the treatment of verticals. The challenge now is to expose the exempt sectors to the Act and to design a compatible regime for the corporatized and privatized utilities.     

Foreign owners and American cement: Old cartel hands,or new kids on the block?

In 1961, all portland cement producing capacity in the United States was owned by companies domiciled here. Thirty years later, about 70% was controlled by foreign owners, mostly European. It has been suggested by various authorities — academic economists, the business press, even cement executives — that foreign governments' tolerance for formal or tacit collusion would bring the American cement industry a kind of ‘price discipline’ that it has been largely unable to practice since 1948. This contention is tested as an hypothesis, using regional data from the U.S. Bureau of Mines and the Portland Cement Association. The test shows either no or a negative relation between foreign control and the level of regional cement prices. At the same time, we observe the traditional positive relation between concentration (HHI) and prices. The results imply that horizontal mergers between cement producers are a better subject for the attention of public policy than where they are owned.