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Publication Date:
March 2007
ISSN:
1935-1682
DOI:
10.2202/1935-1682.1135

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The B.E. Journal of Economic Analysis & Policy

Ed. by Auriol , Emmanuelle / Brunner, Johann / Fleck, Robert / Friebel, Guido / Ludwig, Sandra / Requate, Till / Schneider, Hilmar / Tsui, Kevin / Wichardt, Philipp

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The Pro-collusive Effect of Increasing the Repose Period for Price Fixing Agreements

Jeroen Hinloopen1

1Universiteit van Amsterdam and Katholieke Universiteit Leuven, j.hinloopen@uva.nl

Citation Information: The B.E. Journal of Economic Analysis & Policy. Volume 7, Issue 1, Pages –, ISSN (Online) 1935-1682, DOI: 10.2202/1935-1682.1135, March 2007

Publication History:
Published Online:
2007-03-14

Abstract

Intuitively, extending the period of repose for price fixing agreements enhances the effectiveness of competition policy enforcement. This paper proves this intuition wrong. As extending the repose period reduces cartel members' defection payoff while it leaves unaltered expected compliance profits, it induces cartels to be more stable internally.

Keywords: cartel stability; detection probabilities; statue of limitation

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