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| Cai, Xiaowei; Stiegert, Kyle W.. |
| Understanding how business cartels form and expand is foundational for developing sound deterrence strategies. Past work (i.e. Connor, 2005) has relied on net present value (NPV) methods to evaluate the streams of costs and benefits of forming or joining a cartel. While NPV adequately measure the expected value of future streams of benefits and costs, higher moments of the distribution are also important in understanding agent behavior. Thus, in the presence of uncertainty about future streams and litigation costs, NPV may miss important dimensions that shape the issue. The decision to form or join a cartel is, at least, partially irreversible, because it exposes the firm or its involved managers to litigation on all previous returns and even after the... |
| Tipo: Conference Paper or Presentation |
Palavras-chave: Cartel Joining Behavior; Real Options Theory; International Cartels; Industrial Organization; K21; L00; L12. |
| Ano: 2010 |
URL: http://purl.umn.edu/61301 |
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| Fischer, Thorsten; Kamerschen, David R.. |
| We employ the Rosse-Panzar test to assess market performance in selected airport-pairs originating from Atlanta. The Rosse-Panzar test stands in the tradition of the New Empirical Industrial Organization. It is based on the comparative statics of a reduced form revenue equation. Therefore, it is less powerful than structural models, but it offers the advantage of less stringent data requirements and reduces the risk of model misspecifications. The test statistic allows us in most airport-pairs to reject both conducts consistent with the Bertrand outcome, which is equivalent to perfect competition, and the collusive outcome, which is equivalent to joint profit-maximization. Rather, the test statistic suggests that behavior is consistent with a range of... |
| Tipo: Journal Article |
Palavras-chave: Airlines; Oligopoly; Conduct; Price-cost margins; Lerner index; Rosse-Panzar test; Research Methods/ Statistical Methods; L00; L40; L93. |
| Ano: 2003 |
URL: http://purl.umn.edu/44041 |
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