Editing Collusion (section)

== Deviation ==
[[File:Future collusive profits.jpg|thumb|Future collusive profits]]
Actions that generate sufficient returns in the future are important to every company, and the probability of continued interaction and the company discount factor must be high enough. The sustainability of cooperation between companies also depends on the threat of punishment, which is also a matter of credibility. Firms that deviate from cooperative pricing will use MMC in each market. MMC increases the loss of deviation, and incremental loss is more important than incremental gain when the firm's objective function is concave. Therefore, the purpose of MMC is to strengthen corporate compliance or inhibit deviant collusion.<ref name="doi.org">Sorenson. (2007). Credible collusion in multimarket oligopoly. Managerial and Decision Economics, 28(2), 115–128. https://doi.org/10.1002/mde.1314</ref>

The principle of collusion: firms give up deviation gains in the short term in exchange for continued collusion in the future.
* Collusion occurs when companies place more emphasis on future profits
* Collusion is easier to sustain when the choice deviates from the maximum profit to be gained is lower (i.e. the penalty profit is lower) and the penalty is greater.
* Future collusive profits − future punishment profits ≥ current deviation profits − current collusive profits-collusion can sustain.<ref name="doi.org"/>

Scholars in economics and management have tried to identify factors explaining why some firms are more or less likely to be involved in collusion. Some have noted the role of the regulatory environment<ref>{{Cite journal|last=Morgan|first=Eleanor J.|date=2009|title=Controlling cartels – Implications of the EU policy reforms|url=http://www.sciencedirect.com/science/article/pii/S0263237308000443|journal=European Management Journal|language=en|volume=27|issue=1|pages=1–12|doi=10.1016/j.emj.2008.04.006|issn=0263-2373}}</ref> and the existence of [[leniency programs]].<ref>{{Cite journal|last=Brenner|first=Steffen|date=2009|title=An empirical study of the European corporate leniency program|url=http://www.sciencedirect.com/science/article/pii/S0167718709000290|journal=International Journal of Industrial Organization|language=en|volume=27|issue=6|pages=639–645|doi=10.1016/j.ijindorg.2009.02.007|issn=0167-7187}}</ref>