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Collusive networks in market-sharing agreements under the presence of an antitrust authority

Flavia Roldán

No D/854, IESE Research Papers from IESE Business School

Abstract: This paper studies how the presence of an antitrust authority affects market-sharing agreements made by firms. These agreements prevent firms from entering each other's market. The set of these agreements defines a collusive network, which is pursued by antitrust authorities. This article shows that while in the absence of the antitrust authority, a network is stable if its alliances are large enough when considering the antitrust authority, and more competitive structures can be sustained through bilateral agreements. Antitrust laws may have a pro-competitive effect, as they give firms in large alliances more incentives to cut their agreements at once.

Keywords: market-sharing; economic networks; antitrust authorit; oligopoly (search for similar items in EconPapers)
JEL-codes: D43 K21 L41 (search for similar items in EconPapers)
Pages: 34 pages
Date: 2010-04-07
New Economics Papers: this item is included in nep-com, nep-ind, nep-net and nep-reg
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Working Paper: Collusive networks in market-sharing agreements under the presence of an antitrust authority (2012) Downloads
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