Affiliation:
1. Italian Competition Authority and University of Rome Tor Vergata (email: )
2. University of Melbourne (email: )
3. Duke University (email: )
4. University of Toulouse Capitole (email: )
Abstract
While antitrust authorities strive to detect, prosecute, and thereby deter collusive conduct, entities harmed by that conduct are also advised to pursue their own strategies to deter collusion. The implications of such delegation of deterrence have largely been ignored, however. In a procurement context, we find that buyers may prefer to accommodate rather than deter collusion among their suppliers. We also show that a multimarket buyer, such as a centralized procurement authority, may optimally deter collusion when multiple independent buyers would not, consistent with the view that “large” buyers are less susceptible to collusion. (JEL D21, D43, D44, L12, L14)
Publisher
American Economic Association
Subject
General Economics, Econometrics and Finance
Reference58 articles.
1. Abdulkadiroğlu, Atila, and Kim-Sau Chung. 2003. "Auction Design with Tacit Collusion." Unpublished.
2. Alé-Chilet, Jorge. 2017. "Gradually Rebuilding a Relationship: The Emergence of Collusion in Retail Pharmacies in Chile." Unpublished.
3. Collusion and Price Rigidity
4. Information and Competition in U.S. Forest Service Timber Auctions