Abstract
Within a dynamic market environment the forces that drive the effectiveness of leniency programs in antitrust law are analyzed. This effectiveness unambigously is enhanced by (i) increasing the reduction in fine payments in return for reporting a cartel, and (ii) increasing the expected per-period cartel detection probability for any (future) period. Increasing fine payments for violating antitrust law also enhances the programs' effectiveness provided that the reduction in fine payment in return for reporting is large enough. The effectiveness of leniency programs is not influenced by the length of the period of limitation that comes with violating antitrust laws.
| Original language | English |
|---|---|
| Pages (from-to) | 415-432 |
| Number of pages | 18 |
| Journal | De Economist |
| Volume | 151 |
| Issue number | 4 |
| Publication status | Published - Dec 2003 |
| Externally published | Yes |
Keywords
- cartel stability
- leniency program
- time-dependent detection probabilities
- ENFORCEMENT
- SUPERGAMES
- EQUILIBRIA