Abstract

http://ssrn.com/abstract=1342549
 
 

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Excluding Ringleaders from Leniency Programs


Jesko Herre


University of Cologne

Wanda Mimra


ETH Zürich - CER-ETH - Center of Economic Research at ETH Zurich

Alexander Rasch


University of Cologne

April 1, 2012


Abstract:     
We analyze the impact of ringleader discrimination in leniency programs on the sustainability of collusion. An important role of leniency is to elicit cartel members’ evidence about collusive activity in order to increase the probability of convicting the cartel. We find that ringleader discrimination does not play a role when the ringleader’s relative amount of evidence is high as the collusive agreement will specify and compensate the ringleader to never blow the whistle in any case whereas ringleader discrimination has a pro-collusive (deterring) effect when the ringleader’s relative evidence is moderate (low). Furthermore, ringleader discrimination may deter collusion if the investigation probability of the antitrust authority is sufficiently high but not too high. In this case, the effect of asymmetry from exclusion — even if profits are redistributed — is stronger than the loss of ringleader evidence for conviction.

Number of Pages in PDF File: 33

Keywords: Cartel, collusion, leniency program, ringleader, whistle-blowing

JEL Classification: L40, L41

working papers series


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Date posted: February 14, 2009 ; Last revised: April 26, 2012

Suggested Citation

Herre, Jesko and Mimra, Wanda and Rasch, Alexander, Excluding Ringleaders from Leniency Programs (April 1, 2012). Available at SSRN: http://ssrn.com/abstract=1342549 or http://dx.doi.org/10.2139/ssrn.1342549

Contact Information

Jesko Herre
University of Cologne ( email )
Albertus-Magnus-Platz
Cologne, 50923
Germany
Wanda Mimra (Contact Author)
Swiss Federal Institute of Technology Zurich - CER-ETH - Center of Economic Research at ETH Zurich ( email )
Zürichbergstrasse 18
Zurich, 8092
Switzerland
Alexander Rasch
University of Cologne ( email )
Albertus-Magnus-Platz
Cologne, 50923
Germany
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