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LAWS90064 : An Analysis On Cartel

tag 2 Downloads 8 Pages / 1,823 Words tag 11-11-2020


1.With reference to the case carefully identify the market structure in which the automotive bearings companies operate.
2.What evidence is provided in the case of collusive behaviour? More generally what are the symptoms and tests of collusive behaviour?
3.In the market structure discussed above under 1, what conditions make it possible for dominant firms to collude? Is collusion cheat proof? Base your answer o.a. on insights from game theory.
4.Discuss the incentive(s) of the companies to participate in the cartel.
5.Assess the welfare consequences of the companies' decision to participate in the cartel. Use graphs where possible and appropriate.
6.Identify the direct and indirect costs and benefits of government regulation as applied through competitiion policy.
7.What conclusions can you draw about the Commission decision to impose fines on the cartel participants? Explain why you think it is a good or bad decision. If you believe the fine is an appropriate measure, has it been calculated high/low enough?
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