Fighting collusion by regulating communication between firms

Abstract

Fighting collusion Regulation of communication between firms This paper is an attempt to create a coherent approach to the design of competition policy enforcement against collusion based on theoretical considerations, evidence from economic experiments, and case studies. I argue that collusion should primarily be fought indirectly by targeting types of communication between firms that are particularly likely to facilitate collusion. In particular, I identify types of communication which have high potential anti‐competitive effects but where it is unlikely that prohibiting communication will lead to efficiency losses. This analysis leads to some simple rules concerning communication between firms, which could also guide the development of competition rules for B2B electronic market places. — Kai-Uwe Kühn