International Price-Fixing Cartels and Developing Countries: A Discussion of Effects and Policy Remedies

75 Pages Posted: 26 Feb 2003 Last revised: 31 Oct 2010

See all articles by Margaret C. Levenstein

Margaret C. Levenstein

University of Michigan at Ann Arbor - Survey Research Center; The Stephen M. Ross School of Business at the University of Michigan, Business Economics and Public Policy

Valerie Y. Suslow

Johns Hopkins University - Carey Business School

Lynda J. Oswald

University of Michigan, Stephen M. Ross School of Business

Date Written: February 2003

Abstract

We examine the possible effects of private international cartels on developing countries by looking in detail at three recent cartel cases, as well as at a broader cross-section of 42 recently prosecuted international cartels. We discuss the indirect effects on developing country producers, either as competitors or co-conspirators, as well the direct effects of cartels on developing country consumers. By combining trade data with a sample of US and European prosecutions of international cartels in the 1990s, we are able to estimate the order of magnitude of the consequences of these cartels on developing countries as consumers. In 1997, the latest year for which we have trade data, developing countries imported $54.7 billion of goods from a sub-sample of 19 industries that contained a price-fixing conspiracy during the 1990s. These imports represented 5.2% of total imports and 1.2% of GDP in developing countries.

Suggested Citation

Levenstein, Margaret C. and Suslow, Valerie Y. and Oswald, Lynda J., International Price-Fixing Cartels and Developing Countries: A Discussion of Effects and Policy Remedies (February 2003). NBER Working Paper No. w9511, Available at SSRN: https://ssrn.com/abstract=383440

Margaret C. Levenstein (Contact Author)

University of Michigan at Ann Arbor - Survey Research Center ( email )

500 S. State Street
Ann Arbor, MI 48109
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734-615-9088 (Phone)
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HOME PAGE: http://www-personal.umich.edu/~maggiel

The Stephen M. Ross School of Business at the University of Michigan, Business Economics and Public Policy

Ann Arbor, MI 48109
United States
734-764-8336 (Phone)

Valerie Y. Suslow

Johns Hopkins University - Carey Business School ( email )

100 International Drive
Baltimore, MD 21202
United States

Lynda J. Oswald

University of Michigan, Stephen M. Ross School of Business ( email )

701 Tappan Street
School of Business Administration
Ann Arbor, MI 48109-1234
United States
734-763-9827 (Phone)
734-936-8715 (Fax)

HOME PAGE: http://www.bus.umich.edu

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