Research

Working Paper

When Wholesalers Join the Cartel: Vertical Coordination in Gasoline Markets

Submitted

Abstract: This paper studies how upstream participation changes cartel organization and outcomes in Brazilian gasoline markets. Using antitrust case records, I document that vertical cartels involve wholesalers in coordinating retailers and disciplining deviations through wholesale terms, unlike retail cartels relying on downstream coordination. I combine eight cartel cases with station-level price data and a matching difference-in-differences design, finding larger retail-price and retail-markup effects in vertical-cartel cases, while small retailers capture smaller markup gains and face higher wholesale markups. A model shows how discriminatory wholesale terms weaken retailers’ incentives to remain outside the cartel, broaden participation, and support higher retail prices.

Latest Draft: [PDF] [Slides] [Online Appendix]

Works in Progress

How the State Bids: Government Participation in Procurement Auctions

Managing Long-Run Competition: Evidence from São Paulo Pharmaceutical Procurement

with Karam Kang and Anh H. Nguyen.