A Survey of the Experimental Studies on Leniency Programs

The purpose of this article is to survey recent experimental studies on leniency programs, which have been introduced in competition policies around the world. Some theoretical studies show that leniency programs are effective to dissolve cartels, but they are not strong enough to deter new cartels from being formed. Although one empirical study confirms that leniency programs are effective to dissolve cartels, it is hard to judge from field data whether leniency programs deter cartels and how they influence market prices. To solve these issues, experimental economics studies on leniency programs have been conducted. Most of them also discovered that leniency programs are effective to dissolve cartels. However, it is still necessary to continue to carry out experimental studies to examine the effects on the stability of cartels and market prices, in terms of institutional parameters, such as the investigation frequency, timing of whistle blowing, and the number of firms which can receive leniency

An Experimental Study of Leniency Programs

Antitrust authorities of many countries have been trying to establish appropriate competition policies based on economic analysis. Recently an anti-cartel policy called a "leniency program" has been introduced in many countries as an effective policy to dissolve cartels. In this paper, we studied several kinds of leniency programs through laboratory experiments. We experimentally controlled for two factors: 1) cartel size: the number of cartel members in a group, small (two-person) or large (seven-person), 2) schedule of reduced fine: the number of firms that are given reduced fines. The experimental results showed that (1) an increase in the number of cartel members in a group increased the number of cartels dissolved, (2) changing the coverage of reduced fine had no significant effect both in two-player case and in seven-player case.

Gender and Culture in a Threshold Public Goods Game: Japan versus Canada,

We compare male and female behavior in Japan and Canada in the context of a threshold public goods game with both a strong free-riding equilibrium and many socially efficient threshold equilibria. Although higher rewards produce higher contributions, neither culture nor gender has any significant impact on the equilibrium selected, the amount contributed or the provision success rate. Nonetheless, culture and gender do affect behavior. Japanese females coordinate significantly less closely than Canadian females, while Japanese males coordinate significantly less closely than either Canadian males or Canadian females around an equilibrium. Coordination is related both to conforming and less variable behavior.

Does the Varian Mechanism Work? -Emissions Trading as an Example

This paper investigates whether Varian's (1994) compensation mechanism can work in a laboratory. The results show that this mechanism does not work as in the theory. We found that the magnitude of penalties crucially affects subjects' behavior.

Prevalence of Masked Obesity Associated with Lifestyle-Related Habits, Dietary Habits, and Energy Metabolism in Japanese Young Women

We investigated the prevalence of Masked Obesity (MO) and the correlations between MO and lifestylerelated habits (e.g., exercise habits, dieting habits), dietary habits, energy metabolism, and seasons. The subjects were 131 young Japanese college students. Body composition was measured by bioelectrical impedance method and Resting Metabolic Rate (RMR) was measured by an indirect calorimeter. Subjects with a BMI in the normal range (n=110) were divided into the MO (percentage of body fat to Body Weight [BF]≥30%) and control (C) (BF<30%) groups. Dietary energy and nutrient intakes were calculated from weighed dietary records. A questionnaire on lifestyle habits was obtained individually from the subjects. The percentage of MO was 32% of subjects within normal BMI. The prevalence of MO was the highest in winter, probably due to accumulation of body fat as an adaptation to cold. The MO group had low Fat-Free Mass (FFM) and high BF. RMR of the MO group was significantly lower than that of the C group. The MO group tended to have poor exercise habits, more dieting (restricting calorie intake) experiences and consumed a diet with less vegetables and beans. We concluded that the prevalence of MO was 32%; it was the highest in winter for subjects who had high fat and low FFM. This fact may be due to poor exercise, more dieting experiences and insufficient intake of vegetables and beans. Furthermore, this accumulation of body fat may be partly due to low RMR

Group size effects on cartel formation and the enforcement power of leniency programs

Antitrust authorities in many countries have been trying to establish appropriate competition policies based on economic analysis. Recently an anti-cartel policy called a "leniency program" has been introduced in many countries as an effective policy to dissolve cartels. In this paper, we studied several kinds of leniency programs through laboratory experiments. We experimentally controlled for three factors: 1) cartel size: the number of cartel members in a group, small (two-person) or large (seven-person), 2) fine schedule: the number of firms that are given leniency, and 3) degree of leniency: a partially reduced fine, a fully reduced fine, or a reward is given to self-reporting firms. The experimental results showed that (1) an increase in the number of cartel members in a group increased the number of cartels dissolved, (2) changing the fine schedule had no significant effect both in the two-person group size and in the seven-person group size, and (3) positive enforcement such as giving a reward for a self-reporting firm in a courageous leniency program has great impact on dissolving cartel activities.Leniency programs Cartels Collusion Antitrust law Experiment