On the stability of collusive price leadership

The gains from cartel formation and the stability of a dominant cartel are investigated for the price-leadership model. We show that there is a general interest in the establishment of a cartel with the competitive fringe reaping a disproportionate share of the benefits. In contrast to results invol...

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Bibliographic Details
Main Authors: D'Aspremont, Claude, Jacquemin, Alexis, Gabszewicz, Jean Jaskold, Weymark, John A
Format: Book
Published: Toronto Canadian Economics Association February 1983
Series:The Canadian Journal of Economics n. 1
Subjects:
Description
Summary:The gains from cartel formation and the stability of a dominant cartel are investigated for the price-leadership model. We show that there is a general interest in the establishment of a cartel with the competitive fringe reaping a disproportionate share of the benefits. In contrast to results involving a continuum of firms, with a finite number of firms (each with the same cost curve) there is always a stable dominant cartel.
Physical Description:pp. 17-25 il.
Bibliography:Incluye bibliografía
ISSN:00084085