Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/149496
Authors: 
Boswijk, H. Peter
Bun, Maurice J.G.
Schinkel, Maarten Pieter
Year of Publication: 
2016
Series/Report no.: 
Tinbergen Institute Discussion Paper 16-092/VII
Abstract: 
The begin and end dates of cartels are often ambiguous, despite competition authorities stating them with precision. The legally established infringement period(s), based on documentary evidence, need not coincide with the period(s) of actual cartel effects. In this paper, we show that misdating cartel effects leads to a (weak) overestimation of but-for prices and an underestimation of overcharges. Total overcharges based on comparing but-for prices to actual prices are a (weak) underestimation of the true amount overcharged, irrespective of the type and size of the misdating. The bias in antitrust damage estimation based on predicted cartel prices can have either sign. We extend the before-during-and-after method with an empirical cartel dating procedure that uses multiple structural break tests to determine the actual begin and end date(s) of the effects of collusive agreements. Empirical findings in the European Sodium Chlorate cartel corroborate our theoretical results.
Subjects: 
Cartel
antitrust damages
dates
structural change
break test
but-for
JEL: 
C22
C51
L41
Document Type: 
Working Paper

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