Going Once, Going Twice, Reported!
AbstractWe experimentally examine the effectiveness of antitrust policies against bidding rings in theEnglish auction (EN) and the first-price sealed-bid auction (FP). We consider both traditionalantitrust policy (without a leniency program) and modern antitrust policy (with a leniencyprogram). In EN, neither antitrust policy has a significant effect on cartel deterrence, cartelstability, cartel recidivism, and winning bids. In FP, traditional antitrust policy deters cartelformation, destabilizes cartels, reduces the probability that a cartel re-establishes, and reduces theaverage winning bid. In contrast, while a leniency program has no additional effect on cartelformation or cartel recidivism, it makes cartels more stable and reduces the winning cartel bid.
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Bibliographic InfoPaper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 09-085/1.
Date of creation: 09 Oct 2009
Date of revision: 05 Apr 2013
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Web page: http://www.tinbergen.nl
Antitrust policy; Leniency Programs; English Auction; First-Price Sealed-Bid Auction; Laboratory Experiments;
Find related papers by JEL classification:
- C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
- D44 - Microeconomics - - Market Structure and Pricing - - - Auctions
- L41 - Industrial Organization - - Antitrust Issues and Policies - - - Monopolization; Horizontal Anticompetitive Practices
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-10-31 (All new papers)
- NEP-COM-2009-10-31 (Industrial Competition)
- NEP-EXP-2009-10-31 (Experimental Economics)
- NEP-IND-2009-10-31 (Industrial Organization)
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