Journal article

Publication year: 2017

Pages: 992-1002

Journal: Managerial and Decision Economics

Volume number: 38

Issue number: 7

ISSN: 0143-6570

eISSN: 1099-1468

DOI Link: https://doi.org/10.1002/mde.2840

Publisher: Wiley

Abstract: 
This article analyzes a manager's incentives to establish and sustain an illegal collusive agreement if her firm is subject to profit shocks, if her utility function is concave in profits (e.g., because of risk aversion), and if she incurs opportunity costs (e.g., by violating a social norm). The model supports the empirical observation that if collusion is to be established and sustained in a state with low profits, then this state must be quite persistent. It also indicates that compliance with antitrust laws can be ensured best by combining a zero tolerance policy with a strategy of forgiveness. Copyright (c) 2017 John Wiley & Sons, Ltd.

Harvard Citation style: Paha, J. (2017) Antitrust Compliance: Managerial Incentives and Collusive Behavior, Managerial and Decision Economics, 38(7), pp. 992-1002. https://doi.org/10.1002/mde.2840

APA Citation style: Paha, J. (2017). Antitrust Compliance: Managerial Incentives and Collusive Behavior. Managerial and Decision Economics. 38(7), 992-1002. https://doi.org/10.1002/mde.2840