0000000000740366

AUTHOR

Frode Steen

showing 3 related works from this author

Anatomy of Cartel Contracts

2013

We study cartel contracts using data on 18 contract clauses of 109 legal Finnish manufacturing cartels. One third of the clauses relate to raising profits; the others deal with instability through incentive compatibility, cartel organization, or external threats. Cartels use three main approaches to raise profits: Price, market allocation, and specialization. These appear to be substitutes. Choosing one has implications on how cartels deal with instability. Simplifying, we find that large cartels agree on prices, cartels in homogenous goods industries allocate markets, and small cartels avoid competition through specialization.

Competition (economics)Microeconomicsjel:K12antitrust; cartels; competition policy; contracts; industry heterogeneityIncentive compatibilitySpecialization (functional)CartelCartels; contracts; antitrust; competition policy; industry heterogeneity.Businessjel:L40jel:L41Competition policyIndustrial organization
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Cartels Uncovered

2018

How many cartels are there? The answer is important in assessing the efficiency of competition policy. We present a Hidden Markov Model that answers the question, taking into account that often we do not know whether a cartel exists in an industry or not. Our model identifies key policy parameters from data generated under different competition policy regimes and may be used with time-series or panel data. We take the model to data from a period of legal cartels - Finnish manufacturing industries 1951 - 1990. Our estimates suggest that by the end of the period, almost all industries were cartelized.

Finnish-Soviet tradekilpailupolitiikkajel:L4001 natural sciencesjel:L41jel:L0jel:L60competition lawjel:L00010104 statistics & probabilitykartellit0502 economics and business050207 economics0101 mathematicsta511lainsäädäntöidänkauppa05 social scienceskorporativismiantitrust policykilpailuoikeuslaitAntitrust; cartel; competition; detection; Hidden Markov models; illegal; legal; leniency; policy; registry.jel:L4antitrust; cartel; competition; detection; Hidden Markov models; illegal; legal; leniency; policy; registrykilpailuGeneral Economics Econometrics and Financecartelscorporatism
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Replication data for: Cartels Uncovered

2018

How many cartels are there, and how long do they live? The answers to these questions are important in assessing the need for competition policy. We present a Hidden Markov Model that takes into account that often it is not known whether a cartel exists or not. We take the model to data from a period of legal cartels—Finnish manufacturing industries 1951–1990. Our estimates suggest that once born, cartels are persistent; by the end of the period, almost all industries were cartelized.

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