Antitrust & Competition Policy Blog

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

Friday, July 14, 2017

Partial cross ownership and explicit collusion

Johannes Paha and Samuel de Haas analyze Partial cross ownership and explicit collusion.

ABSTRACT: This article studies the unilateral and coordinated effects of non-controlling minority shareholdings (NCMS). It provides a comprehensive model by integrating the established models of Reynolds and Snapp (1986), Flath (1991), Malueg (1992), and Gilo et al. (2006). It is the first to add a competition authority. The model finds that NCMS lower the sustainability of collusion under a greater variety of situations than was indicated by earlier literature. The collusion destabilizing effect of NCMS is particularly prevalent in the presence of an effective antitrust authority.

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