Price collusion of manufacturers and social welfare losses in Belarus

Abstract

The price collision (explicit and tacit) of manufacturers in goods markets is considered to be illegal because it results in competition restriction or infringement of economic interests of other business entities or consumers. In exceptional cases agreements of that kind can be recognized admissible on condition that they result in production development, the growth of goods sales volumes, stimulation of technological progress or world wide recovery of domestic goods competitiveness. In view of this the assessment of short- and long-term social conse­quences of the price collusion in the goods markets is an actual problem from the point of view of antitrust regulation. The object of our study is to assess inefficiency of the price collusion of manufacturers in the markets of wood particle boards, plywood and fiberboards of Belarus. We developed a methodological approach to the quantitative assessment of inefficiency of the price collusion of manufacturers in oligopoly goods markets. Financial reporting of wood­working companies and the data of the Pricing Policy Department for 2006–2010 were used as the initial data for the quantitative analysis. It is established that the goods markets under study during the period analyzed were statically and dynamically ineffective and their antimonopoly regulation is economically inadvisable.

Ценовой сговор производителей на товарных рынках (и явный, и молчаливый) считается незаконным, поскольку приводит к ограничению конкуренции или ущемлению