Title

Collusion with Internal Contracting

Publication Type

Journal Article

Publication Date

6-2004

Abstract

In this paper, an infinitely-repeated Bertrand game is considered. The model has a two-tier relationship; two firms make a self-enforced collusive agreement and each firm writes a law-enforced contract to its privately-informed agent. The main finding is that in optimal collusion, interaction between intra-firm (internal) contracting and inter-firm collusion may be exploited; inter-firm collusion may enhance the efficiency of internal contract, and conversely, internal contracting may facilitate collusion

Keywords

Price-fixing collusion; Private information; Internal contract; Information distortion

Discipline

Dispute Resolution and Arbitration | International Business

Research Areas

Econometrics

Publication

Games and Economic Behavior

Volume

68

Issue

2

First Page

646

Last Page

669

ISSN

0899-8256

Creative Commons License

Creative Commons Attribution-Noncommercial-No Derivative Works 4.0 License
This work is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 4.0 License.

Additional URL

http://econpapers.repec.org/paper/ecmfeam04/693.htm

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