Endogenous cartel formation with heterogeneous firms

• 成果类型: Article
• 署名作者: Bos, Iwan; Harrington, Joseph E., Jr.
• 署名单位: Maastricht University; Johns Hopkins University
• 刊物名称: RAND JOURNAL OF ECONOMICS
• ISSN/ISSBN: 0741-6261
• DOI: 10.1111/j.1756-2171.2009.00091.x
• 发表日期: 2010
• 页码: 92-117
• 关键词: proof nash equilibria; price; STABILITY; capacity; mergers

摘要

In the context of an infinitely repeated capacity-constrained price game, we endogenize the composition of a cartel when firms are heterogeneous in their capacities. When firms are sufficiently patient, there exists a stable cartel involving the largest firms. A firm with sufficiently small capacity is not a member of any stable cartel. When a cartel is not all-inclusive, colluding firms set a price that serves as an umbrella with non-cartel members pricing below it and producing at capacity. Contrary to previous work, our results suggest that the most severe coordinated effects may come from mergers involving moderate-sized firms, rather than the largest or smallest firms.