Maximal Cartel Pricing and Leniency Programs

H.E.D. Houba; E. Motchenkova; Q. Wen

Maximal Cartel Pricing and Leniency Programs

H.E.D. Houba, E. Motchenkova, Q. Wen

Research output: Working paper › Discussion paper › Other research output

Abstract

For a general class of oligopoly models with price competition, we analyze the impact of ex-ante leniency programs in antitrust regulation on the endogenous maximal-sustainable cartel price. This impact depends upon industry characteristics including its cartel culture. Our analysis disentangles the effects of traditional antitrust regulation and the leniency program. Ex-ante leniency programs are effective if and only if these offer substantial rewards to the self-reporting firm. This is in contrast to currently employed programs that are therefore ineffective.

Original language	English
Place of Publication	Tilburg
Publisher	TILEC
Volume	2008-046
Publication status	Published - 2008

Publication series

Name	TILEC Discussion Paper
Volume	2008-046

Keywords

Cartel
Antitrust Policy
Antitrust Law
Leniency Program
Self-reporting
re-peated game

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http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1317635

Cite this

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AU - Wen, Q.

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AB - For a general class of oligopoly models with price competition, we analyze the impact of ex-ante leniency programs in antitrust regulation on the endogenous maximal-sustainable cartel price. This impact depends upon industry characteristics including its cartel culture. Our analysis disentangles the effects of traditional antitrust regulation and the leniency program. Ex-ante leniency programs are effective if and only if these offer substantial rewards to the self-reporting firm. This is in contrast to currently employed programs that are therefore ineffective.

KW - Cartel

KW - Antitrust Policy

KW - Antitrust Law

KW - Leniency Program

KW - Self-reporting

KW - re-peated game

M3 - Discussion paper

VL - 2008-046

T3 - TILEC Discussion Paper

BT - Maximal Cartel Pricing and Leniency Programs

PB - TILEC

CY - Tilburg

ER -

Maximal Cartel Pricing and Leniency Programs

Abstract

Publication series

Keywords

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