The Effect of Optimal Penalties for Organizations Convicted of Price Fixing in the Presence of Criminal Sanctions for Individuals

20 Pages Posted: 8 Sep 2017

See all articles by Bruce H. Kobayashi

Bruce H. Kobayashi

George Mason University - School of Law

Michelle Burtis

Charles River Associates (CRA) International

Date Written: September 6, 2017

Abstract

This chapter examines the nature of optimal price fixing penalties on organizations in the presence of criminal sanctions for individuals employed by convicted firms. In other work, we examined the nature of optimal penalties for firms convicted for price fixing when the only sanction is the one placed on the firm. This chapter expands the economic analysis to examine how optimal organizational sanctions function when individuals employed by the firm are subject to criminal penalties, including incarceration. Our analysis demonstrates how sanctions on individuals can serve to complement firm level expenditures on monitoring and compliance, resulting in better deterrence and lower compliance costs.

Keywords: Antitrust, Compliance, Consumer Harm, Deterrence, Enforcement, Fines, Law & Economics, Optimal Penalties, Price Fixing, Punishment, Sentencing Guidelines, Volume of Affected Commerce

JEL Classification: K14, K21

Suggested Citation

Kobayashi, Bruce H. and Burtis, Michelle, The Effect of Optimal Penalties for Organizations Convicted of Price Fixing in the Presence of Criminal Sanctions for Individuals (September 6, 2017). George Mason Law & Economics Research Paper No. 17-38. Available at SSRN: https://ssrn.com/abstract=3033281 or http://dx.doi.org/10.2139/ssrn.3033281

Bruce H. Kobayashi (Contact Author)

George Mason University - School of Law ( email )

3301 Fairfax Drive
Arlington, VA 22201
United States
703-993-8034 (Phone)
703-993-8088 (Fax)

HOME PAGE: http://mason.gmu.edu/~bkobayas

Michelle Burtis

Charles River Associates (CRA) International ( email )

1201 F. St. NW
Ste. 700
Washington, DC 20004
United States

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