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Leniency Inflation, Cartel Damages, and Criminalization

Author

Listed:
  • Catarina Marvão

    (Technological University Dublin - City Campus, School of Accounting, Economics and Finance
    SITE - Stockholm School of Economics)

  • Giancarlo Spagnolo

    (SITE - Stockholm School of Economics
    University of Rome Tor Vergata
    EIEF
    CEPR)

Abstract

We revisit the pros and cons of introducing cartel criminalization in the EU. We document the recent EU “leniency inflation”, whereby leniency has been increasingly awarded to many (or all) cartel members, which softens the “courthouse race” effect. Coupled with the insufficient protection of leniency applicants from damages (2014 Damages Directive), it may have led to a decrease in leniency applications and cartel convictions. Given the current level of fines, criminalization may have to be introduced. We then explore US criminal sanctions (1990–2015) to highlight potential areas of concern for EU policymakers, of which recidivism appears to be a significant one.

Suggested Citation

  • Catarina Marvão & Giancarlo Spagnolo, 2023. "Leniency Inflation, Cartel Damages, and Criminalization," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 63(2), pages 155-186, September.
    • Handle: RePEc:kap:revind:v:63:y:2023:i:2:d:10.1007_s11151-023-09920-2
    DOI: 10.1007/s11151-023-09920-2
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    References listed on IDEAS

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