No 107: Competition Policy Story 3 - Naughty naughty Benz

WITH some monopoly power stories is quite difficult to see exactly what a firm is doing wrong, and often economists disagree if what has happened was "against the public interest" - that is, unfair to consumers or other firms in the market.

However, I think that this one is clearly a case of unfair competition:

(Full article here.)

These countries include China, Russia, Thailand, Greece, and Iraq, and the money was mostly given to government officials to get contracts.

Anybody still think this was acceptable? Well, that's your opinion, but at the time Mercedes Benz certainly tried to make sure what they did was secret. Otherwise, why did it use "offshore bank accounts, third-party agents and deceptive pricing practices"?

It has since fired 45 of its employees who involved in this.

2 clear signs that a company may have been doing something naughty. It hides its behaviour at the time, and then gets rid of the employees who were doing it afterwards.