Content area
Full Text
Plus factors are economic actions and outcomes, above and beyond parallel conduct by oligopolistic firms, that are largely inconsistent with unilateral conduct but largely consistent with explicitly coordinated action. Possible plus factors are typically enumerated without any attempt to distinguish them in terms of a meaningful economic categorization or in terms of their probative strength for inferring collusion. In this Article, we provide a taxonomy for plus factors as well as a methodology for ranking plus factors in terms of their strength for inferring explicit collusion, the strongest of which are referred to as "super plus factors."
Introduction
Competition law treats agreements among rival firms to set the terms on which they trade as extremely serious offenses.1 Most of the world's approximately 120 systems of competition law assign the prosecution of cartels a high priority. The consequences of detection can be severe. The annual global sum of civil fines and treble damages for cartel participants today routinely exceeds hundreds of millions-indeed, even billions-of dollars, and individuals in a growing number of countries face potent criminal sanctions. 2
Central to the operation of laws that aggressively punish collusion are the definition and proof of concerted action. Powerful consequences flow from whether price increases observed in the marketplace emerge from individual or collective initiative. A firm acting alone ordinarily can set its prices as high as it likes.3 If the same firm cooperates with its competitors to achieve price increases, however, its executives may go to prison. Despite the crucial role of the concept of concerted action to this framework, few elements of modern antitrust analysis in the United States and in other jurisdictions are more perplexing than the design of evidentiary standards to determine whether parallel conduct stems from collective or from unilateral decisionmaking.4
In the case of oligopolies, authorities have struggled to develop suitable evidentiary standards for identifying agreements. Firms in an oligopolistic industry recognize their mutual interdependence, understand that they are players in a repeated game, and act accordingly.5 In antitrust decisions about allegations of collusive pricing, this pattern of interaction-which courts and commentators describe as "conscious parallelism"-is viewed as insufficient to establish that firms are engaged in concerted action. This is because such pricing can emerge from firms acting noncollusively where...