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How Market Fragmentation Can Facilitate Collusion
dc.contributor.authorKühn, Kai‐uween_US
dc.date.accessioned2012-10-02T17:20:09Z
dc.date.available2013-11-04T19:53:16Zen_US
dc.date.issued2012-10en_US
dc.identifier.citationKühn, Kai‐uwe (2012). "How Market Fragmentation Can Facilitate Collusion." Journal of the European Economic Association 10(5). <http://hdl.handle.net/2027.42/93695>en_US
dc.identifier.issn1542-4766en_US
dc.identifier.issn1542-4774en_US
dc.identifier.urihttps://hdl.handle.net/2027.42/93695
dc.description.abstractEconomists have recommended the fragmentation of capacities before regulated markets are liberalized because static oligopoly models imply that outcomes approximate perfect competition with a fragmented enough market structure. This intuition fails under collusion. When individual firms are capacity constrained relative to total demand, the fragmentation of capacity facilitates collusion and increases the highest sustainable collusive price. Collusive outcomes remain feasible even for arbitrarily fragmented capacity. These results can explain the finding in Sweeting (2007 , Economic Journal , 117, 654–685), that dramatic fragmentation of generation capacity in the English electricity industry did not reduce price cost margins.en_US
dc.publisherWiley Periodicals, Inc.en_US
dc.publisherBlackwell Publishing Incen_US
dc.subject.otherJ1en_US
dc.subject.otherJ11en_US
dc.titleHow Market Fragmentation Can Facilitate Collusionen_US
dc.typeArticleen_US
dc.rights.robotsIndexNoFollowen_US
dc.subject.hlbsecondlevelEconomicsen_US
dc.subject.hlbtoplevelSocial Sciencesen_US
dc.description.peerreviewedPeer Revieweden_US
dc.contributor.affiliationumEuropean Commission and University of Michiganen_US
dc.description.bitstreamurlhttp://deepblue.lib.umich.edu/bitstream/2027.42/93695/1/j.1542-4774.2012.01083.x.pdf
dc.identifier.doi10.1111/j.1542-4774.2012.01083.xen_US
dc.identifier.sourceJournal of the European Economic Associationen_US
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dc.owningcollnameInterdisciplinary and Peer-Reviewed


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