|Year of selection||2008|
|Institution||Université Catholique de Louvain|
Type of support
60 000 €
The Effect of Amnesty Plus on Cartel Formation
Amnesty Plus is a program used by the US Department of Justice: to trigger multiple confessions, this of already convicted firms. This program allows cartel members that are convicted in a first market to get a substantial fine reduction if they report another cartel they are involved in. Yassine Lefouili shows that Amnesty Plus has two opposite effects. In industries where firms are able to collude in multiple markets the risk of a firm reporting one or several of the remaining cartels after a first detection makes it less attractive to create multiple cartels. However, the program can also encourage firms to create more cartels in industries where firms are unable to sustain multimarket collusion. The value of a second cartel gets higher as it will include collusive profits and also the possibility to be sacrificed in order to get a fine reduction in case another cartel is detected.
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