DP2349 Leniency Programs and Cartel Prosecution
|Author(s):||Massimo Motta, Michele Polo|
|Publication Date:||January 2000|
|Keyword(s):||Amnesties, Antitrust, Cartels, Collusion, Optimal Deterrence|
|JEL(s):||D21, K20, L40|
|Programme Areas:||Industrial Organization|
|Link to this Page:||www.cepr.org/active/publications/discussion_papers/dp.php?dpno=2349|
We study the enforcement of competition policy against collusion under Leniency Programs, which give reduced fines to firms revealing information to the Antitrust Authority. Such programs give firms an incentive to break collusion, but may also have a pro-collusive effect, since they decrease the expected cost of misbehaviour. We analyze the optimal policy under alternative rules, obtaining a ranking of the different schemes and showing when the use of reduced fines may improve antitrust enforcement.