1 results for ‘Product Market Collusion’
Motivating Collusion

We examine how executive compensation can be designed to motivate product market collusion. We look at the 2013 decision to close several regional offices of the Department of Justice, which lowered antitrust enforcement for firms located near these closed offices. We argue that this made collusion more appealing to the shareholders, and find that these firms increased the sensitivity of executive pay to local rivals' performance, consistent with rewarding the managers for colluding with them.

2021-07-01
Top

Subscribe for latest content

Be the first to get our newsletter and updates in your inbox.