Economic theory bulletin, 2021, Vol. 9, No. 2, pp. 155–166
LEVINE, David K., Fine cartels, Economic theory bulletin, 2021, Vol. 9, No. 2, pp. 155–166 - https://hdl.handle.net/1814/72406
Retrieved from Cadmus, EUI Research Repository
This paper studies a simple model of a repeated cartel that can punish using both voluntary fines and inefficient prices wars. The idea is to use the fines in response to noisy signals of bad behavior and back it up with threats of price wars in response to the easily observed failure to pay the voluntary fines. The model is shown to deliver the insights of modern repeated game theory in an empirically accurate and tractable form.
First published online: 06 July 2021
Cadmus permanent link: https://hdl.handle.net/1814/72406
Full-text via DOI: 10.1007/s40505-021-00205-z
Sponsorship and Funder information:This article received funding from the MIUR (PRIN 2017H5KPLL).This article was published Open Access with the support from the EUI Library through the CRUI - Springer Transformative Agreement (2020-2024)