We thank four anonymous referees and the coeditor for very constructive comments on the previous version of the article. We also thank participants in various conferences and seminars for helpful comments. Please address correspondence to: Heiko Gerlach, School of Economics, University of Queensland, St Lucia, QLD 4072, Australia. Phone: +61-7-3346-0572. Fax: +61-7-3365-6666. E-mail: firstname.lastname@example.org.
INTERNATIONAL ANTITRUST ENFORCEMENT AND MULTIMARKET CONTACT*
Article first published online: 21 MAY 2012
© (2012) by the Economics Department of the University of Pennsylvania and the Osaka University Institute of Social and Economic Research Association
International Economic Review
Volume 53, Issue 2, pages 635–658, May 2012
How to Cite
Choi, J. P. and Gerlach, H. (2012), INTERNATIONAL ANTITRUST ENFORCEMENT AND MULTIMARKET CONTACT. International Economic Review, 53: 635–658. doi: 10.1111/j.1468-2354.2012.00695.x
Manuscript received June 2010; revised October 2010.
- Issue published online: 21 MAY 2012
- Article first published online: 21 MAY 2012
This article analyzes cartel formation and international antitrust enforcement when multinational firms operate in several jurisdictions with local antitrust authorities. We are concerned with how the sustainability of collusion in one local market is affected by the existence of collusion in other markets when they are linked by a negative demand relationship. The interdependence of cartel stability across markets leads to potential externalities in antitrust enforcement across jurisdictions. Local antitrust enforcement equilibrium enforcement may exhibit a nonmonotonicity in the degree of market integration. We compare it with globally optimal antitrust enforcement policy and discuss the role of international antitrust coordination.