38 Pages Posted: 13 Oct 2009
We study the effect of encouraging private actions for breaches of competition law. We develop a model of litigation and settlement with asymmetric information. We show that screening liable from non-liable defendants requires the Court to restrict the rules governing admissible evidence. We study how to design the rules so as to enhance the role of private litigation in antitrust enforcement and prove that increasing damages is better than reducing costs of initiating suits. We also find large benefits from introducing a system of compensation for defendants found non-liable, paid by unsuccessful plaintiffs.
Suggested Citation: Suggested Citation
Bourjade, Sylvain and Rey, Patrick and Seabright, Paul, Private Antitrust Enforcement in the Presence of Pre-Trial Bargaining. The Journal of Industrial Economics, Vol. 57, Issue 3, pp. 372-409, September 2009. Available at SSRN: https://ssrn.com/abstract=1486862 or http://dx.doi.org/10.1111/j.1467-6451.2009.00383.x
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