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Spatially asymmetric firms and the sustainability of a price agreement

Stefano Colombo ()

Economics Bulletin, 2011, vol. 31, issue 3, 2414-2421

Abstract: We study collusion between price discriminating firms which are asymmetrically located in a linear city. We obtain that higher distance increases the sustainability of the collusive agreement for any degree of spatial asymmetry, and more spatial symmetry between firms increases collusion sustainability whatever is the location of the firms in the space, both assuming grim-trigger and optimal punishment.

Keywords: Collusion; Spatial asymmetry. (search for similar items in EconPapers)
JEL-codes: L1 D4 (search for similar items in EconPapers)
Date: 2011-08-26
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