Strategic profit sharing between firms

José Luis Ferreira and Roberts Waddle

International Journal of Economic Theory, 2010, vol. 6, issue 4, 341-354

Abstract: We introduce the possibility of unilaterally giving profits away to the rival in different oligopolistic contexts. We find that this strategy may be profitable in some circumstances, thus providing a context for partial tacit collusion in one‐shot oligopolistic interactions. Although the strategy in itself may look unrealistic, we argue that it may be hidden behind a more complicated relation of the firms.

Date: 2010
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Persistent link: https://EconPapers.repec.org/RePEc:bla:ijethy:v:6:y:2010:i:4:p:341-354

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