Resource title

Cartel Stability and Economic Integration

Resource image

image for OpenScout resource :: Cartel Stability and Economic Integration

Resource description

This paper investigates the effect of economic integration on the ability of firms to maintain a collusive understanding about staying out of each other?s markets. The paper distinguishes among different types of trade costs: ad valorem, unit, fixed. It is shown that for a sufficient reduction of ad valorem trade costs, a cartel supported by collusion on either quantities or prices will be weakened, thus integration is pro-competitive. If integration consists of a reductions in unit (fixed) trade costs a price setting cartel is strengthened (unaffected), while a quantity setting one is weakened.

Resource author

Philipp J. H. Schröder

Resource publisher

Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/18168

Resource license

Adapt according to the presented license agreement and reference the original author.