Delegation and Firms' Ability to Collude

Lambertini, Luca ; Trombetta, Marco (1998) Delegation and Firms' Ability to Collude. DOI 10.6092/unibo/amsacta/765.
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Abstract

In a model of repeated Cournot competition under complete information, we show that delegation has no effect on cartel stability if managers collude, while it may hinder cartel stability when owners collude in setting the incentive schemes. If owners can choose whether to delegate or keep control of their respective firms, and both groups of individuals collude or play noncooperatively in their respective variables according to the level of intertemporal discount factor, then if managers are not able to collude in output levels, owners' delegation decision is nonmonotone in the discount factor.

Abstract
Document type
Monograph (Working Paper)
Creators
CreatorsAffiliationORCID
Lambertini, Luca
Trombetta, Marco
Keywords
delegation cartel stability
Subjects
DOI
Deposit date
17 Jun 2004
Last modified
17 Feb 2016 14:04
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