Please use this identifier to cite or link to this item:
Aichele, Markus
Year of Publication: 
Series/Report no.: 
Beiträge zur Jahrestagung des Vereins für Socialpolitik 2013: Wettbewerbspolitik und Regulierung in einer globalen Wirtschaftsordnung - Session: Cartels and Tacit Collusion D13-V1
I model the optimal semi-collusive strategy of firms using forward contracts in volatile markets. It has been shown that forward contracts can be used to stabilize a collusive agreement under deterministic (Liski and Montero, 2006) as well as under stochastic market conditions (Aichele, 2012). However, forward trading has a negative effect on the expected profit for collusive firms, since firms have the obligation to fulfill their forward contracts in booms as well as in recessions. Thus, in recessions firms involuntarily sell more than the optimal collusive amount. This profit decreasing effect of forward trading is in contrast to the existing literature, since under certainty forward trading does not alter the collusive profit.
Document Type: 
Conference Paper

Files in This Item:

Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.