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An empirical study of the European corporate leniency program

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  • Brenner, Steffen
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    Abstract

    Leniency programs are widely used as instruments of competition policy. They are supposed to serve two purposes: in the short-run to facilitate the detection of cartels and thereby to reduce cost of legal enforcement, and in the long-run to deter firms from antitrust abuse. In our empirical study of the 1996 EU Leniency Program, we find evidence indicating that the program provides incentives to reveal information on criminal activities in the sense that agencies are better informed about the cartel conduct than they would be absent the program. Investigation and prosecution becomes faster under the leniency program by about 1.5Â years. Finally, we consider sufficient conditions for the destabilizing effect of leniency that regard the number and duration of detected cartels. Our data do not support the view that these conditions are satisfied for this program.

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    Bibliographic Info

    Article provided by Elsevier in its journal International Journal of Industrial Organization.

    Volume (Year): 27 (2009)
    Issue (Month): 6 (November)
    Pages: 639-645

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    Handle: RePEc:eee:indorg:v:27:y:2009:i:6:p:639-645

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    Web page: http://www.elsevier.com/locate/inca/505551

    Related research

    Keywords: Cartel stability Leniency Amnesty Self-reporting Antitrust;

    References

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    Cited by:
    1. Acconcia, Antonio & Immordino, Giovanni & Piccolo, Salvatore & Rey, Patrick, 2013. "Accomplice-Witness and Organized Crime: Theory and Evidence from Italy," CEPR Discussion Papers 9543, C.E.P.R. Discussion Papers.
    2. Hoang, Cung Truong & Hüschelrath, Kai & Laitenberger, Ulrich & Smuda, Florian, 2014. "Determinants of self-reporting under the European corporate leniency program," ZEW Discussion Papers 14-043, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    3. Klein, Gordon J. & Günster, Andrea, 2013. "Enforcement of European Competition Policy - Impact on Competition and Efficiency," Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79989, Verein für Socialpolitik / German Economic Association.
    4. Yassine LEFOUILI & Catherine ROUX, 2008. "Leniency Programs for Multimarket Firms: The Effect of Amnesty Plus on Cartel Formation," Cahiers de Recherches Economiques du Département d'Econométrie et d'Economie politique (DEEP), Université de Lausanne, Faculté des HEC, DEEP 08.05, Université de Lausanne, Faculté des HEC, DEEP.
    5. Barbara Baarsma & Ron Kemp & Rob Noll & Jo Seldeslachts, 2012. "Let’s Not Stick Together: Anticipation of Cartel and Merger Control in The Netherlands," De Economist, Springer, vol. 160(4), pages 357-376, December.
    6. Zhou, J., 2012. "Endogenous Lysine Strategy Profile and Cartel Duration: An Instrumental Variables Approach," Discussion Paper, Tilburg University, Tilburg Law and Economic Center 2012-009, Tilburg University, Tilburg Law and Economic Center.
    7. Patrice Bougette & Christian Montet & Florent Venayre, 2006. "L'efficacité économique des programmes de clémence," Post-Print halshs-00476807, HAL.
    8. Clemens, Georg & Rau, Holger A., 2014. "Do leniency policies facilitate collusion? Experimental evidence," DICE Discussion Papers 130, Heinrich‐Heine‐Universität Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    9. Marc Blatter & Winand Emons & Silvio Sticher, 2014. "Optimal Leniency Programs when Firms Have Cumulative and Asymmetric Evidence," Diskussionsschriften, Universitaet Bern, Departement Volkswirtschaft dp1405, Universitaet Bern, Departement Volkswirtschaft.
    10. Choi, Jay Pil & Gerlach, Heiko, 2012. "Global cartels, leniency programs and international antitrust cooperation," International Journal of Industrial Organization, Elsevier, Elsevier, vol. 30(6), pages 528-540.
    11. Hyytinen, Ari & Steen, Frode & Toivanen, Otto, 2010. "Cartels Uncovered," Discussion Paper Series in Economics 10/2010, Department of Economics, Norwegian School of Economics.
    12. Sánchez Navarro, Dennis, 2013. "Eficacia y asimetrías de los programas de delación en un contexto multi-mercado: un análisis del caso colombiano en el marco del TLC con Estados Unidos
      [Efficacy and asymmetries of the leniency pro
      ," MPRA Paper 48699, University Library of Munich, Germany.
    13. Robert M. Feinberg & Minsoo Park, 2014. "Deterrence Effects of Korean Antitrust Enforcement on Producer Prices and Profit Margins," Working Papers, American University, Department of Economics 2014-07, American University, Department of Economics.
    14. Marvao, Catarina, 2014. "The EU Leniency Programme and Recidivism," SITE Working Paper Series 27, Stockholm Institute of Transition Economics, Stockholm School of Economics.
    15. Sauvagnat, Julien, 2014. "Are leniency programs too generous?," Economics Letters, Elsevier, vol. 123(3), pages 323-326.
    16. Dennis Sánchez Navarro, 2013. "Eficacia y asimetrías de los programas de delación en un contexto multimercado: un análisis del caso colombiano en el marco del TLC con Estados Unidos," ESTUDIOS ECONÓMICOS SIC 010905, SUPERINTENDENCIA DE INDUSTRIA Y COMERCIO.

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