Antitrust & Competition Policy Blog

Editor: D. Daniel Sokol
University of Florida
Levin College of Law

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Thursday, June 24, 2010

Collusive networks in market-sharing agreements under the presence of an antitrust authority

Posted by D. Daniel Sokol

Flavia Roldan (IESE Business School) presents Collusive networks in market-sharing agreements under the presence of an antitrust authority.

ABSTRACT: This paper studies how the presence of an antitrust authority affects market-sharing agreements made by firms. These agreements prevent firms from entering each other's market. The set of these agreements defines a collusive network, which is pursued by antitrust authorities. This article shows that while in the absence of the antitrust authority, a network is stable if its alliances are large enough when considering the antitrust authority, and more competitive structures can be sustained through bilateral agreements. Antitrust laws may have a pro-competitive effect, as they give firms in large alliances more incentives to cut their agreements at once.

http://lawprofessors.typepad.com/antitrustprof_blog/2010/06/collusive-networks-in-marketsharing-agreements-under-the-presence-of-an-antitrust-authority-.html

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