What impact does antitrust intervention have on competition? The case of public drug procurement in Russia

Maria Ostrovnaya and Elena Podkolzina

HSE Working papers from National Research University Higher School of Economics

Abstract: In this paper we study antitrust intervention in long-term relationships between public procurer and his preferred supplier in one of the Russian regions. We presume that antitrust control of auctions held by affiliated procurer increases the risks of implementing long-term relationships with his preferred supplier. However we found out that after the intervention of antitrust agency the number of bidders in the auctions increased, but relative contract prices remained the same. We argue that procurer and preferred bidder invited firm with passive bidding strategy to decrease the risks of antitrust punishment. Thereby, antitrust intervention led to fake competition, but not to honest non-corrupt behavior in public auctions

Keywords: public auctions; antitrust policy; pharmaceuticals; Russia. (search for similar items in EconPapers)
JEL-codes: H57 L40 (search for similar items in EconPapers)
Pages: 26 pages
Date: 2013
New Economics Papers: this item is included in nep-cis, nep-com and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Published in WP BRP Series: Economics / EC, July 2013, pages 1-26

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Persistent link: https://EconPapers.repec.org/RePEc:hig:wpaper:32/ec/2013

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