Collusion Sustainability with Multimarket Contacts: Revisiting HHI Tests

Edmond Baranes, François Mirabel and Jean-Christophe Poudou

Working Papers from LAMETA, Universtiy of Montpellier

Abstract: Our paper focuses on the relationship between market concentration and collusion sustainability in a framework of multimarket contacts. We consider two independent and symmetric markets in which a subset of firms are active in both markets. When firms are able to transfer market power from one market to another, firms have strong incentives to collude even in a highly competitive market. This result is relevant for competition policy since assessing market concentration using HHI index could be misleading in some situations.

Pages: 15 pages
Date: 2009-03, Revised 2009-03
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http://www.lameta.univ-montp1.fr/Documents/DR2009-05.pdf First version, 2009 (application/pdf)
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Working Paper: Collusion Sustainability with Multimarket Contacts: Revisiting HHI Tests (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:lam:wpaper:09-05

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