Motivating Collusion

Sangeun Ha, Fangyuan Ma, Alminas Žaldokas

Research output: Contribution to conferencePaperCommunication


We examine how executive compensation can be designed to motivate product marketcollusion. We look at the 2013 decision to close several regional offices of the Depart-ment of Justice, which lowered antitrust enforcement for firms located near these closedoffices. We argue that this made collusion more appealing to the shareholders, and findthat these firms increased the sensitivity of executive pay to local rivals’ performance,consistent with rewarding the managers for colluding with them. The affected CEOswere also granted more equity compensation, which provides long-term incentives thatcould foster collusive arrangements.
Original languageEnglish
Publication date2022
Number of pages75
Publication statusPublished - 2022
Event32nd Annual Conference on Financial Economic and Accounting. CFEA 2022 - Georgia State University, Atlanta, United States
Duration: 4 Nov 20225 Nov 2022
Conference number: 32


Conference32nd Annual Conference on Financial Economic and Accounting. CFEA 2022
LocationGeorgia State University
Country/TerritoryUnited States
Internet address


  • Product market collusion
  • Corporate governance
  • Managerial compensation

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