65 research outputs found

    Leniency Policies and Illegal Transactions

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    Forthcoming in the Journal of Public Economics. We study the consequences of leniency – reduced legal sanctions for wrongdoers who spontaneously self-report to law enforcers – on sequential, bilateral, illegal transactions, such as corruption, manager-auditor collusion, or drug deals. It is known that leniency helps deterring illegal relationships sustained by repeated interaction. Here we find that - when not properly designed - leniency may simultaneously provide an effective governance mechanism for occasional sequential illegal transactions that would not be feasible in its absence.amnesty; corruption; collusion; financial fraud; governance; hold up; hostages; illegal trade; immunity; law enforcement; leniency; organized crime; self-reporting; whistleblowers

    Deterrence in Competition Law

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    This paper provides a comprehensive discussion of the deterrence properties of a competition policy regime. On the basis of the economic theory of law enforcement we identify several factors that are likely to affect its degree of deterrence: 1) sanctions and damages; 2) financial and human resources; 3) powers during the investigation; 4) quality of the law; 5) independence; and 6) separation of power. We then discuss how to measure deterrence. We review the literature that use surveys to solicit direct information on changes in the behavior of firms due to the threats posed by the enforcement of antitrust rules, and the literature based on the analysis of hard data. We finally argue that the most challenging task, both theoretically and empirically, is how to distinguish between “good” deterrence and “bad” deterrence

    Parallelismo e collusione

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    Abstract Antitrust authorities often consider parallelism of firms' strategies and market share stability as clues of illegal collusion in the form of concerted practices. In this paper I show that this inference may be contrary to some theoretical results. I develop a model of price competition with differentiated products in which demand and costs vary over time. If the market is perturbed by shocks on the supply or on the demand side which are common to all firms, then price parallelism will occur both in a competitive and in a collusive equilibrium and cannot signal which one occurred. If shocks are firm specific, price parallelism connotes a competitive market. The paper also shows that the competitive equilibrium is characterized by a higher market share stability than a collusive equilibrium

    Deterrence in Competition Law

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    This paper provides a comprehensive discussion of the deterrence properties of a competition policy regime. On the basis of the economic theory of law enforcement we identify several factors that are likely to affect its degree of deterrence: 1) sanctions and damages; 2) financial and human resources; 3) powers during the investigation; 4) quality of the law; 5) independence and 6) separation of power. We then discuss how to measure deterrence. We review the literature that uses surveys to solicit direct information on changes in the behavior of firms due to the threats posed by the enforcement of antitrust rules, and the literature based on the analysis of hard data. We finally argue that the most challenging task, both theoretically and empirically, is how to distinguish between “good” deterrence and “bad” deterrence. ZUSAMMENFASSUNG - (Abschreckung im Wettbewerbsrecht) Dieser Beitrag bietet eine umfassende Diskussion ĂŒber die Abschreckungseigenschaften eines wettbewerbspolitischen Systems. Auf der Grundlage der ökonomischen Theorie der Rechtsdurchsetzung werden mehrere Faktoren identifizier, welche den Abschreckungsgrad des Systems am ehesten beeinflussen können. Diese sind: 1) Sanktionen und Schadensersatzforderungen, 2) finanzielle Ressourcen und Personal der Wettbewerbsbehörde, 3) die Befugnisse der wettbewerbspolitischen AutoritĂ€t im Rahmen der Untersuchung, 4) die QualitĂ€t des Rechtsrahmens, 5) die UnabhĂ€ngigkeit der Behörde und 6) die Gewaltenteilung. Anschließend wird diskutiert, wie man den Abschreckungsgrad eines wettbewerbspolitischen Systems empirisch messen kann. Zuerst wird die Literatur besprochen, die auf Befragungen beruht. Die Befragungen sollten Aufschluss darĂŒber geben, wie sich das Unternehmensverhalten angesichts der Durchsetzung von wettbewerbspolitischen Maßnahmen Ă€ndert. Dem gegenĂŒber wird die Literatur dargestellt, die "harte" Daten nutzt. Schließlich wird argumentiert, dass die anspruchsvollste Aufgabe sowohl theoretisch als auch empirisch darin bestehen wird, zwischen "guter" und "schlechter" Abschreckung durch Wettbewerbspolitik zu unterscheiden.Competition Policy, Law Enforcement, Deterrence

    Competition Policy and Productivity Growth: An Empirical Assessment

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    This paper empirically investigates the effectiveness of competition policy by estimating its impact on Total Factor Productivity (TFP) growth for 22 industries in 12 OECD countries over the period 1995-2005. We ?nd a robust positive and signi?cant effect of competition policy asmeasured by newly created indexes. We provide several arguments and results based on instrumental variables estimators as well as non-linearities to support the claim that the established link can be interpreted in a causal way. At a disaggregated level, the effect on TFP growth is particularly strong for speci?c aspects of competition policy related to its institutional setup and antitrust activities (rather than merger control). The effect is strengthened by good legal systems, suggesting complementarities between competition policy and the ef?ciency of law enforcement institutions.Competition Policy; Productivity Growth; Institutions; Deterrence; OECD

    Leniency and Damages: Where Is the Conflict?

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    Damage actions may reduce leniency programs’ attractiveness for cartel participants if their cooperation with the competition authority increases the chance that the cartel’s victims will sue them. This apparent conflict between public and private antitrust enforcement led to calls for a legal compromise. We show that the conflict is due to the legislation and a compromise is not required: limiting the victims’ ability to recover their loss is not necessary to preserve the effectiveness of leniency programs and may be counterproductive. We show that damage actions will actually improve its effectiveness, if the civil liability of the immunity recipient is minimized and full access to all evidence collected by the competition authority, is granted to claimants. Our results help compare the EU and US damage systems and directly question the 2014 EU Directive which tries to protect leniency programs’ effectiveness by restricting access to leniency statements in subsequent damage actions

    Competition policy and productivity growth: an empirical assessment

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    "This paper empirically investigates the effectiveness of competition policy by estimating its impact on Total Factor Productivity (TFP) growth for 22 industries in 12 OECD countries over the period 1995-2005. We find a robust positive and significant effect of competition policy as measured by newly created indexes. We provide several arguments and results based on instrumental variables estimators as well as non-linearities, to support the claim that the established link can be interpreted in a causal way. At a disaggregated level, the effect on TFP growth is particularly strong for specific aspects of competition policy related to its institutional set up and antitrust activities (rather than merger control). The effect is strengthened by a good legal system, suggesting complementarities between competition policy and the efficiency of law enforcement institutions." (author's abstract)"In diesem Beitrag untersuchen wir die EffektivitĂ€t von Wettbewerbspolitik anhand der empirischen SchĂ€tzung ihrer Auswirkung auf das totale FaktorproduktivitĂ€tswachstum (TFP) fĂŒr 22 Branchen in 12 OECD-LĂ€ndern ĂŒber den Zeitraum 1995-2005. Wir finden eine robuste positive und statistisch signifikante Wirkung der Wettbewerbspolitik, welche von neu erstellten Indizes gemessen wird. Wir prĂ€sentieren unterschiedliche Argumente und Ergebnisse basierend auf Instrumental-Variablen SchĂ€tzern sowie NichtlinearitĂ€ten, um den geschĂ€tzten Zusammenhang als kausal interpretieren zu können. Auf einer disaggregierten Ebene aufgeschlĂŒsselt ist die Auswirkung auf das TFPWachstum besonders stark fĂŒr spezifische Aspekte der Wettbewerbspolitik, welche eher mit deren institutionellen Aufbau und kartellrechtlichen TĂ€tigkeiten in Zusammenhang stehen als mit der Fusionskontrolle. Wir zeigen, dass der gemessene Effekt durch gute Rechtssysteme gestĂ€rkt wird, was auf KomplementaritĂ€ten zwischen Wettbewerbspolitik und der Effizienz der Justiz hindeutet." (Autorenreferat

    Deterrence in competition law

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    This paper provides a comprehensive discussion of the deterrence properties of a competition policy regime. On the basis of the economic theory of law enforcement we identify several factors that are likely to affect its degree of deterrence: 1) sanctions and damages; 2) financial and human resources; 3) powers during the investigation; 4) quality of the law; 5) independence and 6) separation of power. We then discuss how to measure deterrence. We review the literature that uses surveys to solicit direct information on changes in the behavior of firms due to the threats posed by the enforcement of antitrust rules, and the literature based on the analysis of hard data. We finally argue that the most challenging task, both theoretically and empirically, is how to distinguish between 'good' deterrence and "bad" deterrence." (author's abstract)"Dieser Beitrag bietet eine umfassende Diskussion ĂŒber die Abschreckungseigenschaften eines wettbewerbspolitischen Systems. Auf der Grundlage der ökonomischen Theorie der Rechtsdurchsetzung werden mehrere Faktoren identifizier, welche den Abschreckungsgrad des Systems am ehesten beeinflussen können. Diese sind: 1) Sanktionen und Schadensersatzforderungen, 2) finanzielle Ressourcen und Personal der Wettbewerbsbehörde, 3) die Befugnisse der wettbewerbspolitischen AutoritĂ€t im Rahmen der Untersuchung, 4) die QualitĂ€t des Rechtsrahmens, 5) die UnabhĂ€ngigkeit der Behörde und 6) die Gewaltenteilung. Anschließend wird diskutiert, wie man den Abschreckungsgrad eines wettbewerbspolitischen Systems empirisch messen kann. Zuerst wird die Literatur besprochen, die auf Befragungen beruht. Die Befragungen sollten Aufschluss darĂŒber geben, wie sich das Unternehmensverhalten angesichts der Durchsetzung von wettbewerbspolitischen Maßnahmen Ă€ndert. Dem gegenĂŒber wird die Literatur dargestellt, die 'harte' Daten nutzt. Schließlich wird argumentiert, dass die anspruchsvollste Aufgabe sowohl theoretisch als auch empirisch darin bestehen wird, zwischen 'guter' und 'schlechter' Abschreckung durch Wettbewerbspolitik zu unterscheiden." (Autorenreferat
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