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Leniency policy in hub and spoke cartels

Author

Listed:
  • Rodrigo Londoño van Rutten
  • Nikolas Vander Vennet
  • Caroline Buts
  • Marc Jegers

Abstract

The competition literature documents that leniency programmes can either destabilize or reinforce the sustainability of horizontal cartels. We contribute to this body of literature by looking at a specific type of cartels, namely hub and spoke cartels. Drawing on earlier work of Van Cayseele and Miegielsen (2013)1 on hub and spoke cartels, and Chen and Rey’s dynamic leniency model for horizontal cartels (2013),2 this paper builds a model that measures the impact of leniency programmes on hub and spoke cartels. From our model it follows that it is always desirable to offer some ex-ante leniency to the first-reporting hub and spoke cartel member to discourage cartel formation and that this optimal leniency rate is unique for both the hub and spokes.

Suggested Citation

  • Rodrigo Londoño van Rutten & Nikolas Vander Vennet & Caroline Buts & Marc Jegers, 2025. "Leniency policy in hub and spoke cartels," European Competition Journal, Taylor & Francis Journals, vol. 21(3), pages 481-504, September.
    • Handle: RePEc:taf:recjxx:v:21:y:2025:i:3:p:481-504
    DOI: 10.1080/17441056.2024.2440227
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