Colluding Against Environmental Regulation

• 成果类型: Article; Early Access
• 署名作者: Ale-Chilet, Jorge; Chen, Cuicui; Li, Jing; Reynaert, Mathias
• 署名单位: Universidad de los Andes - Chile; State University of New York (SUNY) System; University at Albany, SUNY; Tufts University; Universite de Toulouse; Universite Toulouse 1 Capitole; Toulouse School of Economics
• 刊物名称: REVIEW OF ECONOMIC STUDIES
• ISSN/ISSBN: 0034-6527
• DOI: 10.1093/restud/rdaf024
• 发表日期: 2025
• 关键词: discrete-choice models; collusion; emissions; DESIGN; prices; MARKET

摘要

We study collusion among firms against imperfectly monitored environmental regulation. Firms increase variable profits by violating regulation and reduce expected noncompliance penalties by violating jointly. We consider a case of three German automakers colluding to reduce the effectiveness of emissions control technology. By estimating a structural model of the European automobile industry from 2007 to 2018, we find that collusion lowers expected noncompliance penalties substantially and increases buyer and producer surplus. Due to increased pollution, welfare decreases by 1.57-5.57 billion. We show how environmental policy design and antitrust play complementary roles in preventing noncompliance.