Global Cartels, Leniency Programs and International Antitrust Cooperation

33 Pages Posted: 15 Apr 2010  

Jay Pil Choi

Michigan State University - Department of Economics; CESifo (Center for Economic Studies and Ifo Institute)

Heiko A. Gerlach

University of Queensland - School of Economics

Date Written: March 2010

Abstract

In this paper we analyze cartel formation and self-reporting incentives when firms operate in several geographical markets and face antitrust enforcement in different jurisdictions. We are concerned with the effectiveness of leniency programs and the benefits of international antitrust cooperation between agencies. When international antitrust prosecution is uncoordinated, multi-market contact allows firms to reduce the amount of self-reporting in equilibrium and sustain cartels more effectively. We then discuss the effects of information sharing among antitrust authorities as a function of how much and which type of information is exchanged. We show that extensive information sharing might have an adverse effect on self-reporting by cartel members.

Keywords: cartel formation, multi-market contact, leniency programs, international antitrust cooperation

JEL Classification: L13, L41, D43

Suggested Citation

Choi, Jay Pil and Gerlach, Heiko A., Global Cartels, Leniency Programs and International Antitrust Cooperation (March 2010). CESifo Working Paper Series No. 3005. Available at SSRN: https://ssrn.com/abstract=1587968

Jay Pil Choi (Contact Author)

Michigan State University - Department of Economics ( email )

101 Marshall Hall
East Lansing, MI 48824
United States
517-353-7281 (Phone)

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

HOME PAGE: http://www.CESifo.de

Heiko A. Gerlach

University of Queensland - School of Economics ( email )

Brisbane, QLD 4072
Australia

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