Please use this identifier to cite or link to this item: http://hdl.handle.net/2445/185231
Title: Managers' expectations, business cycles and cartels' life cycle
Author: García Galindo, Carmen
Borrell, Joan-Ramon
Ordóñez de Haro, José Manuel
Jiménez González, Juan Luis
Keywords: Cicles econòmics
Directius
Càrtels
Anàlisi de regressió
Business cycles
Executives
Cartels
Regression analysis
Issue Date: 1-Jun-2022
Publisher: Springer Verlag
Abstract: The literature presents mixed findings regarding the economic conditions under which cartels form and collapse, and regarding how stable they are across firm-specific and industry-wide business cycles. The relationship between cartel life cycles and business cycles has been insufficiently analyzed to date. In this paper, we study in depth whether collusion is pro-cyclical or counter-cyclical. We analyze the relationship between cartel start-ups/break ups and economic cycles using a dataset of sanctioned cartels by the European Commission (EC) that were active between 1997 and 2018, after the leniency program had already been introduced. We also double check whether this relationship has changed with respect to the pre-leniency period from 1991 to 1996. Our results show that cartels are more likely to be formed when the business has evolved positively in the previous months, and cartels are less likely to collapse when the business has evolved positively, and managers expect prices to decline. The EC's sanctioning activity has been an effective deterrent and has had a destabilizing effect on cartels. However we found no evidence that managers' expectations on prices affect cartel formation. All these results are an important issue for anti-cartel policy enforcement since knowing when cartels are more prone or less likely to occur would help authorities prevent their formation or their early detection.
Note: Reproducció del document publicat a: https://doi.org/10.1007/s10657-022-09730-z
It is part of: European Journal of Law and Economics, 2022, vol. 53, num. June, p. 451-484
URI: http://hdl.handle.net/2445/185231
Related resource: https://doi.org/10.1007/s10657-022-09730-z
ISSN: 0929-1261
Appears in Collections:Articles publicats en revistes (Econometria, Estadística i Economia Aplicada)

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