Antitrust laws prohibit private firms to coordinate their market behavior, yet many types of interfirm cooperation are legal. Using laboratory experiments, we study spillovers from legal cooperation in one market to non-competitive prices in a different market. Our theoretical framework predicts...

Antitrust laws prohibit private firms to coordinate their market behavior, yet many types of interfirm cooperation are legal. Using laboratory experiments, we study spillovers from legal cooperation in one market to non-competitive prices in a different market. Our theoretical framework predicts...

The condition is derived for Friedman 's trigger strategy to sustaina collusive market equilibrium as a noncooperative Nash equilibriumgiven subjective beliefs as to the antitrust authority's ability of suc-cesfully dissolving the illegal cartel.