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Leniency Programs for Multimarket Firms: The Effect of Amnesty Plus on Cartel Formation

Yassine Lefouili and Catherine Roux

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Abstract: We examine the effect of the Amnesty Plus policy on firms' incentives to engage in cartel activities. Amnesty Plus is a proactive antitrust enforcement strategy aimed at attracting amnesty applications by encouraging firms already convicted in one market to report collusive agreements in other markets. It has been heavily advertised that Amnesty Plus weakens cartel stability. We show to the contrary that Amnesty Plus does not always have this desirable effect. Only under specific conditions, Amnesty Plus deters a cartel which would have been sustainable under an antitrust policy without Amnesty Plus. Otherwise, Amnesty Plus is either neutral or even stabilizes a cartel. We also show that the firms can exploit their multimarket contact to reduce the effectiveness of the Amnesty Plus policy .

Keywords: Amnesty Plus; Leniency Program; Multimarket Contact; Antitrust Policy (search for similar items in EconPapers)
Date: 2008-09
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Published in 35th Conference of the European Association for Research in Industrial Economics (EARIE), Sep 2008, France

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Journal Article: Leniency programs for multimarket firms: The effect of Amnesty Plus on cartel formation (2012) Downloads
Working Paper: Leniency programs for multimarket firms: The effect of Amnesty Plus on cartel formation (2010) Downloads
Working Paper: Leniency Programs for Multimarket Firms: The Effect of Amnesty Plus on Cartel Formation (2008)
Working Paper: Leniency Programs for Multimarket Firms: The Effect of Amnesty Plus on Cartel Formation (2008)
Working Paper: Leniency Programs for Multimarket Firms: The Effect of Amnesty Plus on Cartel Formation (2008)
Working Paper: Leniency Programs for Multimarket Firms: The Effect of Amnesty Plus on Cartel Formation (2008) Downloads
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