CELS/USC Virtual Antitrust Law Workshop Series: 'Market-wide Collusion between Suppliers and Retailers'

Speaker: Professor David Gilo (Tel Aviv)

Abstract: We study "market collusion", where retailers and suppliers maximize their joint profits in a repeated game. Market collusion is price-increasing when product substitutability is high and price-decreasing when product substitutability is low. It is always stable when product substitutability is intermediate. Price-decreasing market collusion is more stable than successive collusion (supplier collusion followed by retailer collusion), while price-increasing market collusion is less stable than successive collusion. Successive collusion is more socially harmful than market collusion and rms prefer market collusion to successive collusion. The results can support a rule of reason approach toward market collusion when product substitutability is low.

To register your interest for this event please contact Professor Oke Odudu (oo201@cam.ac.uk).