Details

Autor(en) / Beteiligte

• Bos, Iwan
• Marini, Marco A.

Titel

Cartel stability under quality differentiation

Ist Teil von

• Economics letters, 2019-01, Vol.174, p.70-73

Ort / Verlag

Amsterdam: Elsevier B.V

Erscheinungsjahr

2019

Quelle

Alma/SFX Local Collection

Beschreibungen/Notizen

• This note considers cartel stability when the cartelized products are vertically differentiated. If market shares are maintained at pre-collusive levels, then the firm with the lowest competitive price-cost margin has the strongest incentive to deviate from the collusive agreement. The lowest-quality supplier has the tightest incentive constraint when the difference in unit production costs is sufficiently small. •We consider cartel stability when firms sell vertically differentiated products.•Deviating incentives are decreasing in the competitive profit margin.•The lowest-quality firm has the strongest incentive to defect with similar unit costs.