Abstract
This paper analyses the South African flour cartel, active from 1999 to 2007 and provides an overcharge estimation by using comparator based methods. The empirical analysis is complemented by a descriptive overview of the history and structure of the South African flour industry. The flour cartel fixed the price of flour and allocated customers from 1999 to 2007. We find that the overcharges to independent bakeries range from 7 % to 42 %. We also show that the cartel profits were approximately two times higher during the cartel than the price war year 2002 or the post collusion year 2008.
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