Legal and Economic Aspects of Competitive Market Behavior

About the report:

This report represents the first phase of an effort in support of the Virginia Department of Transportation's recently created Antitrust Monitoring and Detection Unit within the Construction Division. It provides background on the economic and legal aspects of anticompetitive market behavior and the recent experience with bid rigging in the construction industry. The purpose of the work is to provide a framework for a second phase, which will be an empirical study of the highway construction industry in Virginia. The second-phase work will also support VDOT in its evaluation of collusion detection models, the ultimate goal of which is to establish a comprehensive antitrust monitoring and detection system for use by the Construction Division of VDOT. This report has four major sections. The first deals with economic factors affecting competitive behavior. The second describes major aspects of antitrust law as it affects the highway construction industry. The third section is a summary of recent experience with bid rigging, and the final section presents proposals for hindering collusive behavior and detecting anti trust violations.

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