By Justin P. Johnson (Cornell University) & D. Daniel Sokol (University of Florida)
Antitrust compliance scholarship, particularly with a focus on collusion, has been an area of study for some time. Changes in technology and the rise of artificial intelligence (AI) and machine-learning create new possibilities both for anti-competitive behavior and to aid in detection of such algorithmic collusion. To some extent, AI collusion takes traditional ideas of collusion and simply provides a technological overlay to them. However, in some instances, the mechanisms of both collusion and detection can be transformed using AI. This handbook chapter discusses existing theoretical and empirical work, and identifies research gaps as well as avenues for new scholarship on how firms or competition authorities might invest in AI compliance to improve detection of wrong doing. We suggest where AI collusion is possible and offer new twists to where prior work has not identified possible collusion. Specifically, we identify the importance of AI to address the “trust” issue in collusion. We also identify that AI collusion is possible across non-price dimensions, such as manipulated product reviews and ratings, and discuss potential screens involving co-movements of prices and ratings. We further emphasize that AI may encourage entry, which may limit collusive prospects. Finally, we discuss how AI can be used to help with compliance both at the firm level and by competition authorities.
Featured News
Judge Mehta Questions Both Sides in Landmark Google Antitrust Case
May 2, 2024 by
CPI
FCC Urges Urgent Funding for Removal of Chinese Telecom Equipment from U.S. Networks
May 2, 2024 by
CPI
Former Pioneer CEO Facing Potential Criminal Charges For Colluding With OPEC
May 2, 2024 by
CPI
South Korea’s Antitrust Regulator Greenlights K-Pop Powerhouse Deal
May 2, 2024 by
CPI
Exxon’s Pioneer Purchase Approved, Former CEO Barred from Board
May 2, 2024 by
CPI
Antitrust Mix by CPI
Antitrust Chronicle® – Economics of Criminal Antitrust
Apr 19, 2024 by
CPI
Navigating Economic Expert Work in Criminal Antitrust Litigation
Apr 19, 2024 by
CPI
The Increased Importance of Economics in Cartel Cases
Apr 19, 2024 by
CPI
A Law and Economics Analysis of the Antitrust Treatment of Physician Collective Price Agreements
Apr 19, 2024 by
CPI
Information Exchange In Criminal Antitrust Cases: How Economic Testimony Can Tip The Scales
Apr 19, 2024 by
CPI