Cartel Stability and Economic Integration

Philipp J. H. Schröder

15 citations0/0 files storedReview of International Economics

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Global trade and economics Merger and Competition Analysis Global Trade and Competitiveness

Abstract

Abstract This paper revisits the notion that economic integration—modeled as a reduction of trade costs—may be anticompetitive, in the sense that it may reinforce the ability of an international cartel to maintain a collusive understanding about staying out of each other’s markets. The paper is novel in terms of introducing ad valorem and fixed trade costs in addition to the customary unit trade costs. It is shown that an anticompetitive effect, found for reductions in unit trade costs, may disappear once trade costs are ad valorem or fixed.

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References

1995National Borders Matter: Canada-U.S. Regional Trade Patterns.2000One money, one market: the effect of common currencies on trade 2001The growth of world trade: tariffs, transport costs, and income similarity 2004Shipping the Good Apples Out? An Empirical Confirmation of the Alchian‐Allen Conjecture 1988Completing the internal market in the European Community 1993OECD imports and trade barriers in 1983 1985Trade Liberalization and Industrial Organization: Some Estimates for Canada 1988Completing the Internal Market in the European Community: Some Industry Simulations

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