This paper considers non-economic factors involved in the occurrence and sustainability of collusion. Group development among executives of incumbent firms created during the evolution of an industry can stimulate collusion, even in the uncertain introduction stage of a new industry. Certain social conditions and social characteristics of executives related to the industry characteristics of entry barriers and geographical structure help to explain differences in group development relevant to collusion. A historical analysis of four transportation industries illustrates the manner in which the non-economic factors operate.
- Group processes among executives
- Evolution of industries