Friedman, J. and Jehiel, P. and Thisse, J. (1995) Collusion and antitrust detection. Japanese Economic Review , 46 (3) pp. 226-246. 10.1111/j.1468-5876.1995.tb00014.x.
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This paper investigates the impact of antitrust policy on the strategic choice ofproduct specification when firms can collude with respect to prices, cannot collude with respect to location and may have their collusion ended if it is detected by the antitrust authority. Depending on the aggressiveness of the antitrust authority, different location configurations may emerge in equilibrium. Extremely aggressive and extremely lax policies lead to the least efficient outcomes while the configuration maximizing social welfare is obtained by an intermediate policy.
|Title:||Collusion and antitrust detection|
|UCL classification:||UCL > School of Arts and Social Sciences > Faculty of Social and Historical Sciences > Economics|
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