TY - UNPB
T1 - Evaluating Leniency and Modeling Cartel Durations
T2 - Time-Varying Policy Impacts and Sample Selection
AU - Zhou, J.
PY - 2011
Y1 - 2011
N2 - This paper examines the effects of the European Commission’s (EC) new leniency program on the EC’s capabilities in detecting and deterring cartels. I discuss a dynamic model of cartel formation and dissolution to illustrate how changes in antitrust policies and economic conditions might affect cartel duration. Comparative statics results are then corroborated with empirical estimates of hazard functions adjusted to account for both the heterogeneity of cartels and the time-varying policy impacts suggested by theory. Statistical tests are consistent with the theoretic predictions that following an efficacious leniency program, the average duration of discovered cartels rises in the short run and falls in the long run.
AB - This paper examines the effects of the European Commission’s (EC) new leniency program on the EC’s capabilities in detecting and deterring cartels. I discuss a dynamic model of cartel formation and dissolution to illustrate how changes in antitrust policies and economic conditions might affect cartel duration. Comparative statics results are then corroborated with empirical estimates of hazard functions adjusted to account for both the heterogeneity of cartels and the time-varying policy impacts suggested by theory. Statistical tests are consistent with the theoretic predictions that following an efficacious leniency program, the average duration of discovered cartels rises in the short run and falls in the long run.
KW - evaluation of antitrust policies
KW - leniency
KW - time-varying policy effects
KW - sample selection bias
M3 - Discussion paper
VL - 2011-042
T3 - TILEC Discussion Paper
BT - Evaluating Leniency and Modeling Cartel Durations
PB - TILEC
CY - Tilburg
ER -