Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/123717
Authors: 
Fink, Nikolaus
Schmidt-Dengler, Philipp
Stahl, Konrad
Zulehner, Christine
Year of Publication: 
2015
Series/Report no.: 
ZEW Discussion Papers 14-058
Abstract: 
Cartels were legal to a large extent in Austria until the country's EU Accession in 1995. We examine archival material on registered horizontal cartels to learn about their inner working. Applying content analysis to legally binding cartel contracts, we comprehensively document different collusion methods along the lines described by Stigler (1964). Quota cartels employ regular reporting schemes and use compensation mechanisms for departures from set quotas. Specialization cartels divide markets, and rely the least on information exchange and punishment. Price and payment condition cartels primarily aim to prevent secret price cuts, requiring information provision upon request, allow for discretionary decision-taking and (sometimes immediate) punishment. These stylized facts on the contractual arrangements suggest that the possibility to write legally binding agreements was employed to address the usual obstacles to sustaining collusion.
Subjects: 
Collusion
Cartels
Legal Cartels
Contracts
JEL: 
L41
L43
Document Type: 
Working Paper

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