Price-Fixing: Hefty Penalties on Big-Biz Cartels Will Provide Level Playing Field to Small Businesses

Economic Times, (Comments & Analysis), August 2012

University of Baltimore School of Law Legal Studies Research Paper

3 Pages Posted: 5 Jun 2013

See all articles by John M. Connor

John M. Connor

American Antitrust Institute (AAI); Purdue University

Robert H. Lande

University of Baltimore - School of Law

Date Written: August 30, 2012

Abstract

Cartels are illegal in India, as they are almost everywhere. They are subject to heavy fines. Why, then, do businesses frequently try to fix prices? Because doing so usually is profitable. On average cartels raise prices by more than 20%, and probably face less than a 25% chance of being caught and convicted. Based upon a sample of 75 international cartels, the authors calculate that the expected profits from price fixing almost always exceed the penalties. No wonder businesses often try to fix prices.

Keywords: Antitrust, price fixing, India, cartels, India Antitrust law, fines, antitrust fines

JEL Classification: K19, K21, K29, K49, L40, L49

Suggested Citation

Connor, John M. and Connor, John M. and Lande, Robert H., Price-Fixing: Hefty Penalties on Big-Biz Cartels Will Provide Level Playing Field to Small Businesses (August 30, 2012). Economic Times, (Comments & Analysis), August 2012, University of Baltimore School of Law Legal Studies Research Paper, Available at SSRN: https://ssrn.com/abstract=2273747

John M. Connor

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Robert H. Lande (Contact Author)

University of Baltimore - School of Law ( email )

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