Competition as a Socially Desirable Dilemma

Christoph Engel

No 2006_12, Discussion Paper Series of the Max Planck Institute for Research on Collective Goods from Max Planck Institute for Research on Collective Goods

Abstract: A cartel is socially not desirable. But is it a normative problem? And has merger control reason to be concerned about tacit collusion? Neither is evident once one has seen that the members of a cartel face a problem of strategic interaction. It is routinely analysed in terms of game theory. Much less frequently, however, an obvious parallel is drawn. For cartel members, the formation of the cartel and cartel discipline are a public good. Making the parallel explicit is elucidating both at the theoretical and at the experimental levels. The paper contrasts oligopoly theory with public goods theory, and oligopoly experiments with public goods experiments.

Keywords: Oligopoly; Public Good; Experiment (search for similar items in EconPapers)
JEL-codes: C72 D21 D43 H41 K21 L13 L41 (search for similar items in EconPapers)
Pages: 38 pages
Date: 2006-05
New Economics Papers: this item is included in nep-cdm, nep-com, nep-exp, nep-law, nep-mic and nep-pbe
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:mpg:wpaper:2006_12

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