The aim of this paper is to summarize the theory of (implicit) collusion in the framework of infinitely repeated games, and in particular, to survey the comprehensive literature exploring which factors make collusion easier or more difficult to sustain. On this basis, the existing empirical studies and the experimental results will be discussed. Policy options as e.g. leniency programs are also analyzed. Although the number of clear cut policy conclusions is limited, understanding thoroughly the mechanisms of collusion is important for (anti-trust) policies. Copyright Springer Science + Business Media, Inc. 2005collusion, capacity constraints, international oligopolies, competition policy, leniency programs,
The aim of this annual workshop is to offer a forum for young researchers from the field of International Economics to present and to discuss their current topics of research with other experts. The workshop also provides the opportunity to gain an overview of recent developments, problems and methodological approaches in this field.Detailed information on past workshops and the planning for the 2005 workshop are available at http://www.vwl.wiso.uni-goettingen.de/workshop. Do not hesitate to contact Dr. Carsten Eckel, CeGE (carsten.eckel@wiwi.uni-goettingen.de) for further questions.
On the Credibility of Currency BoardsSwitgard Feuerstein and Oliver Grimm University of Heidelberg
September 2004Abstract The paper compares the credibility of currency boards and (standard) pegs. Abandoning a currency board requires a time-consuming legislative process and an abolition will thus be previously expected. Therefore, a currency board solves the time inconsistency problem of monetary policy. However, policy can react to unexpected shocks only with a time lag, thus the threat of large shocks makes the abolition more likely. Currency boards are more credible than standard pegs if the time inconsistency problem dominates. In contrast, standard pegs, that can be left at short notice, are more credible if exogenous shocks are highly volatile and constitute the dominant problem.
JEL-classification: E42, E52, F33
Using detailed micro data on European retail food prices for EU15 and all eight Central and Eastern European accession countries, we analyse price convergence within the European Union after the enlargement shock in 2004. Testing for σ-convergence, we nd strong price convergence within EU23, which is mainly explained by convergence between and not within the two subgroups of the old and the new member states.
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