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The problem is that theoretically that could both indicate collusion or market efficiency.
by cuchoi 7y ago
The problem is that theoretically that could both indicate collusion or market efficiency.
- p1necone 7y agoCan we tell the difference just by estimating production costs? (at least in the case of soda, candy etc). Or is it more complicated than that?
- cuchoi 7y agoIn theory, yes. If you had a good estimate of marginal economic costs then it would be easier to conclude if there is collusion. In practice, it is very difficult to estimate economic costs. This, for example, would include estimating the opportunity cost of each company's investment.