I. INTRODUCTION
“...people of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.”
(Adam Smith, 1776)
Price Collusion can be seen as the “combinations, conspiracies or agreements” among firms to raise the market prices and to restrict their output in order to increase profits. In other words, collusion is a usually “secret agreement among competing firms” in an industry to dominate the market, control the market price, and otherwise act like a monopoly.
II. PRICE COLLUSION IN DETAILS
A. THE PRICE COLLUSION IS ILLEGAL IN SOME COUNTRIES
In many social settings, cooperation is beneficial-like product standard, research and development, and limits on promotion and advertising. However, collusion between or among firms to raise prices or restrict output to raise prices, often referred to as price-fixing or price collusion, is viewed as the most serious violation of competition laws and strictly illegal in many countries, especially in the United States by antitrust laws. However, some U.S firms still break the law because of the lure of join profit. Firms found guilty of collusion can be fined and, in some countries, their managers can be imprisoned. For example, because the meetings had been recorded, top executives at Archer Daniels Midland were accused served time in prison in 1998 because of conspiring with “four Asian competitors to rig the $6.5 million world market for lysine” or In the case of “Sotheby’s and Christie’s conspiracy to raise fees to sellers at their auction houses, Christie’s came forward first, and it was Alfred Taubman of Sotheby’s who spent time in jail”....