Database of Price-Fixing Overcharges, 1699 - 2007

<p>The Price-Fixing Overcharges (PFO) Data Set comprises the largest known collection of estimated market price effects from corporate collusion. The PFO spreadsheet summarizes every published overcharge estimate (numbering 2,476 observations) generated by 709 price-fixing cartels over 331 years -- 1699 to 2019. Each overcharge is accompanied by the name of the market, a two-digit industry group, dates of collusion, and several cartel characteristics (corporate membership, geographic extent of pricing operations, jurisdictions of pricing activity, whether bid-rigging or classic price fixing, and whether penalized or not). The publication source and the method of computation are also noted.</p>

<p>Details from which the summary spreadsheet was created are laid out in a 455-page report by the author, Price-Fixing Overcharges: Revised 4th Edition. It carefully defines the overcharge concepts, measurements, legal-economic importance, and historical evolution. Using large numbers of tables and charts, this report provides an exhaustive analysis of the overcharges across cartel types and time.</p>

<p>Primary findings are:</p>

<ul>
<li>The median episodic (average long-run) overcharge estimates for all types of cartels since the 1700s is 23.5% above benchmark prices (or, less meaningfully, 19.0% of affected commerce).</li>
<li>The variation in median episodic overcharges is high, with an overall standard deviation of 19.5%.</li>
<li>Large variation makes the mean overall average overcharge at least 120% of the but-for price.</li>
<li>Unadjusted overcharges reached their zenith in 1890-1919 and have trended downward ever since.</li>
<li>Overcharges corrected in richly specified meta-analyses also demonstrate declines since 1919.</li>
<li>Five percent of cartels are ineffective. Median effective overcharges are 25.0% (20.0% of sales).</li>
<li>International-membership cartels have median overcharges 36% higher than domestic cartels.</li>
<li>Convicted cartels are on average 19% more effective at raising prices than unpunished cartels.</li>
<li>Bid-rigging conduct displays 25% lower mark-ups than classic price-fixing cartels.</li>
<li>When cartels are at peak effectiveness, price increases average 117% higher than the whole episode.</li>
<li>Pay-for-delay conduct (i.e., excluding generic drug entry) raises median pharma prices by XXX%.</li>
<li>Laboratory and natural market data find that the Monopoly Effectiveness Index varies from 15% to 95%; i.e., a cartel’s long-run price effects are 5% to 91% lower than its peak-period price.</li>
<li>Median duration of cartel episodes is 61 months, a longevity remarkably constant over centuries</li>
<li>Historical monetary penalties are nearly always too low to optimally deter cartels.</li>
</ul>