Some employment contracts contain a non-compete clause that prohibits an employee from engaging in certain activities for

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Some employment contracts contain a non-compete clause that prohibits an employee from engaging in certain activities for its company's competitors for a certain amount of time after the employment agreement has come to an end. Sometimes one competitor sues another when the latter hires the former's ex-employee in violation of a covenant not to compete. At other times, competitors enter into agreements not to hire each other's employees. However, mutual no-hire agreements run afoul of antitrust laws. What would be the purpose of a no-hire agreement among competitors? What type of market structure would these firms be trying to achieve?

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Microeconomics

ISBN: 9781292215624

8th Global Edition

Authors: Jeffrey Perloff

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