Detrebling Versus Decoupling Antitrust Damages: Lessons from the Theory of Enforcement

Abstract

This continent compares two alternative systems of private antitrust enforcement. In one (referred to as the "damage multiplier approach"), the plaintiff receives what the defendant pays; in the other (the"decoupling approach"), this constraint is not imposed. Reducing treble damages to single damages("detrebling") would be an example of the first approach. Making the defendant pay treble damages while only giving the plaintiff single damages would be an example of the second approach. It is shown, using the principles of the the economic theory of enforcement, that the decoupling approach is preferable to the damage multiplier approach, and that the optimal system of decoupling could award the plaintiff more or less than what the defendant pays. Several additional issues are raised that need to be considered before decoupling can be recommended in practice.