Lobbying and Cartel Enforcement

52 Pages Posted: 28 Mar 2022 Last revised: 27 Jul 2022

See all articles by Alexandre Girard

Alexandre Girard

University of Namur; Saint-Louis University, Brussels

Jean-Yves Gnabo

University of Namur

Rodrigo Londoño van Rutten

UCLouvain Saint-Louis Brussels

Date Written: July 18, 2022

Abstract

This paper examines the effect of firms' lobbying activities on penalties received from public competition authorities. We first show that prosecuted firms tend to increase their lobbying expenditures when they are under investigation. In a following set of results, our estimates report that lobbying expenditures are negatively associated with the amount of the cartel sanction, across firms and within cartels. We also observe that cartel sanctions are more responsive to lobbying expenditures when (1) the head of the antitrust authority is appointed by a less conservative president and (2) the lobbying firm qualifies for the leniency program. Overall, our results appear consistent with the regulatory capture and the informational lobbying theories, with a stronger effect for the latter.

Keywords: Cartel, Lobbying, US Antitrust Division, Cartel Enforcement, Cartel Sanctions, Competition authorities

JEL Classification: D72, G28, K21

Suggested Citation

Girard, Alexandre and Girard, Alexandre and Gnabo, Jean-Yves and Londoño van Rutten, Rodrigo, Lobbying and Cartel Enforcement (July 18, 2022). Available at SSRN: https://ssrn.com/abstract=4042727 or http://dx.doi.org/10.2139/ssrn.4042727

Alexandre Girard

University of Namur ( email )

8, rempart de la vierge
Namur, 5000
Belgium

Saint-Louis University, Brussels ( email )

43 Boulevard du Jardin botanique
Brussels, 1000
Belgium

Jean-Yves Gnabo

University of Namur ( email )

Rempart de la Vierge, 8
Namur B-5000
Belgium

Rodrigo Londoño van Rutten (Contact Author)

UCLouvain Saint-Louis Brussels ( email )

43 Boulevard du Jardin botanique
Brussels, 1000
Belgium

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