How the new leniency program in Korea affect cartel formation and cartel detection?

Hyo Won Lee and Yun Jeong Choi
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Hyo Won Lee: Yonsei University
Yun Jeong Choi: Yonsei University

No 2014rwp-65, Working papers from Yonsei University, Yonsei Economics Research Institute

Abstract: The corporate leniency program has played an important role in detecting cartels that damages consumer welfare and competition. This study investigates the impacts of Korea¡¯s leniency revision in 2005 on cartel stability by using a Poisson regression. The estimation results show that the new leniency program increases the detection rate and decreases the formation rate, confirming the validity of the theoretical model of Miller(2008). Therefore, the effectiveness of the full leniency to the first applicants under the new leniency program provides some policy implication on the revision direction of the leniency program.

Keywords: Collusion; Corporate Leniency Program; Poisson regression; Cartel duration (search for similar items in EconPapers)
JEL-codes: C72 D43 K21 L41 (search for similar items in EconPapers)
Pages: 19pages
Date: 2014-04
New Economics Papers: this item is included in nep-com, nep-ind and nep-law
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