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Government‐Assisted Oligopoly Coordination? A Concrete Case[Note 1. Thanks are due to Steen Asmund of the Competition ...]
Author(s) -
Albæk Svend,
Møllgaard Peter,
Overgaard Per B.
Publication year - 1997
Publication title -
the journal of industrial economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.93
H-Index - 77
eISSN - 1467-6451
pISSN - 0022-1821
DOI - 10.1111/1467-6451.00057
Subject(s) - oligopoly , competition (biology) , danish , publication , economics , government (linguistics) , market power , power (physics) , microeconomics , industrial organization , business , advertising , monopoly , cournot competition , linguistics , philosophy , ecology , physics , quantum mechanics , biology
In 1993 the Danish antitrust authority decided to gather and publish firm‐specific transactions prices for two grades of ready‐mixed concrete in three regions of Denmark. Following initial publication, average prices of reported grades increased by 15–20 percent within one year. We investigate whether this was due to a business upturn and/or capacity constraints, but argue that these seem to have little explanatory power. We conclude that a better explanation is that publication of prices allowed firms to reduce the intensity of oligopoly price competition and, hence, led to increased prices contrary to the aim of the authority.