Macroeconomic Effects of Market Structure Distortions: Evidence from French Cartels

We provide systematic evidence on cartels’ characteristics, using novel data on cases investigated by the French Competition Authority. These practices are widely spread across sectors and cartel members are typically among the top firms in their industries. In a model with heterogeneous firms and collusion, cartels amplify misallocation by charging supracompetitive markups. Breaking down French cartels would increase aggregate productivity by 2%, welfare by 3.5%, bringing the economy 37% closer to the efficient frontier. These numbers shed light on the aggregate importance of collusion. JEL Classification Numbers: D43, K21, L13, L41, O47

• Publication year

  2022

• Venue

  IMF Working Papers

• Publication date

  2022-05-01

• Fields of study

  Not labeled

• Identifiers
  DOI 10.5089/9798400210686.001
• External record

  Open on Semantic Scholar

• Source metadata

  Semantic Scholar

• No claims are published for this paper.

• No concepts are published for this paper.

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