How to avoid regulatory antitrust scrutiny: The behavioral defense

Arpita Agnihotri

Business Horizons, 2015, vol. 58, issue 4, 441-447

Abstract: Firms, especially those with high profit margins, are often scrutinized by regulatory authorities that suspect them of anticompetitive practices such as cartel formation. In this article I introduce a behavioral approach of competing that suggests firms with even the highest of margins are actually competing aggressively against each other, rather than colluding as the regulatory authorities might suggest. Firms using the behavioral approach can signal to antitrust authorities that their intent is not to restrain competition. Four mechanisms show this competitive orientation: (1) competitive intensity, (2) competitive complexity, (3) attack imitation, and (4) competitive action speed.

Keywords: Competitive dynamics; Anticompetitive behavior; Cartel formation; Regulation; Duopolies; Signaling (search for similar items in EconPapers)
Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:eee:bushor:v:58:y:2015:i:4:p:441-447

DOI: 10.1016/j.bushor.2015.04.002

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