The Rise and (Potential) Fall of U.S. Cartel Enforcement

30 Pages Posted: 2 May 2018 Last revised: 21 May 2018

Vivek Ghosal

Rensselaer Polytechnic Institute; Center for Economic Studies and Ifo Institute for Economic Research (CESifo)

D. Daniel Sokol

University of Florida - Levin College of Law; George Washington University Law School Competition Law Center

Date Written: April 14, 2018

Abstract

Government enforcement against collusion, now viewed by the Supreme Court as the “supreme evil” in antitrust, has gone through various phases of enforcement in the U.S. There have been periods in which cartels have been able to collude more or less effectively given various institutional tools at the disposal of the government. By analyzing enforcement and prosecutions data over a long time horizon 1969-2016, this article examines the attributes of cartel enforcement over time and the changing use of tools to assist with detection and punishment. We provide a comprehensive description of critical cartel enforcement events and institutional developments from 1890 to the present. Our examination of the data includes a detailed descriptive analysis which tends to reveal three broad phases of U.S. cartel enforcement and prosecutions. The most recent data indicate a marked decline in the number of prosecutions, but sharp increase in per capita penalties. We also conduct regression-based estimation of the potential quantitative impact of the key institutional innovations to foster detection and prosecutions. Base on the raw data as well as our estimation, we comment on the potential factors that may be driving lower prosecutions in the more recent years. Finally, we briefly compare some key data between U.S. and European Commission cartel prosecutions to examine potential dynamic interlinkages.

Keywords: Collusion, Price-Fixing, Cartels, Antitrust, Enforcement, Prosecution, Leniency, Fines, Incarceration, Politics, ACPERA, Antitrust Amendments Act

JEL Classification: K21, L41, L13, L11

Suggested Citation

Ghosal, Vivek and Sokol, D. Daniel, The Rise and (Potential) Fall of U.S. Cartel Enforcement (April 14, 2018). Available at SSRN: https://ssrn.com/abstract=3162867 or http://dx.doi.org/10.2139/ssrn.3162867

Vivek Ghosal

Rensselaer Polytechnic Institute ( email )

110 8th Street
Troy, NY 12180
United States
518-276-3868 (Phone)

HOME PAGE: http://www.economics.rpi.edu/pl/people/ghosal

Center for Economic Studies and Ifo Institute for Economic Research (CESifo)

Poschinger Str. 5
Munich
Germany

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

D. Daniel Sokol (Contact Author)

University of Florida - Levin College of Law ( email )

Spessard L. Holland Law Center
P.O. Box 117625
Gainesville, FL 32611-7625
United States
(352) 273-0968 (Phone)
(352) 392-3005 (Fax)

HOME PAGE: http://www.law.ufl.edu/faculty/d-daniel-sokol

George Washington University Law School Competition Law Center ( email )

200 H Street, NW
Washington, DC 20052
United States

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