Antitrust & Competition Policy Blog

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

A Member of the Law Professor Blogs Network

Thursday, July 7, 2011

Strategic delegation and collusion: Do incentive schemes matter?

Posted by D. Daniel Sokol

Jean-Daniel Guigou (Luxembourg School of Finance, University of Luxembourg), Patrick De Lamirande (Shannon School of Business, Canada), and Bruno Lovat (University of Nancy) asks Strategic delegation and collusion: Do incentive schemes matter?

ABSTRACT: This paper introduces delegation decisions and contracts based on relative performance evaluation (RPE) in the analysis of cartel stability. We follow the approach developed by Lambertini and Trombetta [12], where manager's compensation combines pro_ts and sales (CPS) instead. Some of our results are similar while others are distinct from those of Lambertini and Trombetta. In particular, we show that collusion under RPE is always harder to sustain than under CPS.

http://lawprofessors.typepad.com/antitrustprof_blog/2011/07/strategic-delegation-and-collusion-do-incentive-schemes-matter-.html

| Permalink

TrackBack URL for this entry:

http://www.typepad.com/services/trackback/6a00d8341bfae553ef01538f03435c970b

Listed below are links to weblogs that reference Strategic delegation and collusion: Do incentive schemes matter? :

Comments

Post a comment