Study offers new view of how cartels work
Wednesday, December 19, 2018 - 07:40
in Mathematics & Economics
Suppose you were building a cartel—a group of business interests who coordinate to fix high prices that consumers must pay. How would you design it? Received economic wisdom says transparency among cartel members is crucial: If colluding suppliers share information, they can keep prices high and monitor members of the cartel to make sure no one deviates from the cartel's norms.