Swimming in Pools: Collusion in the Salmon Market

Swimming in Pools: Collusion in the Salmon Market

Danial Asmat

Spotify Economics - R&D

Margaret C. Levenstein

University of Michigan at Ann Arbor - Survey Research Center; The Stephen M. Ross School of Business at the University of Michigan, Business Economics and Public Policy

Valerie Y. Suslow

Johns Hopkins University - Carey Business School

Zhihan (Helen) Wang

University of Michigan, Stephen M. Ross School of Business

 

Abstract

We study the events alleged in recent Norwegian salmon industry antitrust cases to explore the relationship between vertical integration and collusion. In particular, we are interested in whether vertical integration can facilitate the strategic use of coordination devices such as public price indices. The salmon market provides an intriguing opportunity to study these issues, as there was a vertical merger followed by a reformulation of the methodology by which prices for forward and spot contracts were reported for a new price index. We explore possible non-strategic motivations for the merger (e.g., labor cost efficiencies) and whether the confluence of the merger and the creation of the Nasdaq price index is associated with evidence consistent with collusion.