“Domestic and international research joint ventures: The effect of collusion” (joint with Guiomar Ibáñez-Zárate and Bernd Theilen)
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Abstract: We analyze the effect of research joint ventures (RJVs) on consumer welfare in an international context when collusion can occur. The main novelty of our analysis is to study the differentiated effect of domestic and international RJVs. The recent literature shows that RJVs with collusion harm consumers. However, our results introduce a qualification to this statement: international RJVs with collusion might be beneficial for consumers when internationalization costs are high. The EU and US competition policy advises against RJVs that facilitate collusion on the grounds of their expected negative effects. Our results suggest that antitrust authorities should distinguish between domestic and international RJVs and, in certain cases, be more benevolent with international RJVs.
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