The paper studies bidder behavior in simultaneous, continuous, ascending price auctions. We design and implement a ‘‘collusion incubator’’ environment based on a type of public, symmetrically ‘‘folded’’ and ‘‘item-aligned’’ preferences. Tacit collusion develops quickly and reliably within the environment. Once tacit collusion developed, it proved remarkably robust to institutional changes that ...

This paper estimates the implicit model, especially the roles of size asymmetries and firm numbers, used by the European Commission to identify mergers with coordinated effects. This subset of cases offers an opportunity to shed empirical light on the conditions where a Competition Authority believes tacit collusion is most likely to arise. We find that, for the Commission, tacit collusion is a...

We examine the economics literature on tacit collusion in oligopoly markets and take steps toward clarifying the relation between economists’ analysis of tacit collusion and those in the legal literature. We provide an example to motivate the idea that collusive profits can be achieved via tacit coordination in an environment where there is a unique, salient way for colluders to maximize and di...

Abstract When consumers have preference costs, two opposing effects need to be assessed analyse the incentives of firms set collusive prices. On one hand, costs make a deviation from collusion less attractive, as deviating firm must offer large enough discount cover costs. other lock in and punishment rivals effective. are low, latter dominates is more challenging sustain than situation with no...