Collusion Screening in the Indian Pharmaceutical Market

A means of detecting colluding behaviour by firms using basic and widely available economic data would be an extremely useful tool within the field of economics. In spite of several proposed methods and theories in economic literature cartels are –in practice- only taken down when either it fails internally, leading to one of its members informing authorities or as the result of journalistic investigation. In this paper we make an attempt at using the theories developed by Marshall and Marx (2012) in order to screen the Indian pharmaceutical market for possible colluding behaviour. We focus on a particular group of medicines that lends itself to analysis due to their partial governmental control and choose one medicine for a detailed case study. Although no definitive proof of collusion is obtained from the analysis we do come across a number of abnormalities across the market that we believe make it hard to accept the absence of collusion and/or unethical practices in general as a truthful fact. We present some possibilities for future case studies in light of the same topic.