Corporate Leniency Programs in the EU and the USA
21 Pages Posted: 29 Apr 2003
Date Written: February 2003
We develop a model to analyze and to compare the corporate leniency programs in the EU and the USA. Both programs are based on the idea that strategic interactions between the team members can be used to increase expected fines by being generous to self-reporting firms. This is in sharp contrast to the well-known literature on self-reporting schemes with single violators where leniency can never lead to higher expected fines. Although the two programs share some common features, there are also important differences. To investigate these differences we introduce a model with two self-reporting stages, heterogenous types with respect to the amount of evidence provided, and ex post asymmetric information.
Keywords: self-reporting, optimal law enforcement, criminal teams, leniency programs
JEL Classification: D62, D82, H50, K42
Suggested Citation: Suggested Citation