Economic efficiency, antitrust and rate-of-return
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This paper examines the economic consequences of using excessive rates-of-return to detect and prosecute cartels. We find that this policy leads to inefficient factor utilization, but always increases output and welfare. The rate-of-return policy may yield greater social gains than a welfare-based antitrust policy.
KeywordsEconomic Consequence Industrial Organization Economic Efficiency Factor Utilization Antitrust Policy
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