Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/229899
Authors: 
Andres, Maximilian
Bruttel, Lisa Verena
Friedrichsen, Jana
Year of Publication: 
2021
Series/Report no.: 
DIW Discussion Papers No. 1926
Abstract: 
The experimental literature on antitrust enforcement provides robust evidence that communication plays an important role for the formation and stability of cartels. We extend these studies through a design that distinguishes between innocuous communication and communication about a cartel, sanctioning only the latter. To this aim, we introduce a participant in the role of the competition authority, who is properly incentivized to judge communication content and price setting behavior of the firms. Using this novel design, we revisit the question whether a leniency rule successfully destabilizes cartels. In contrast to existing experimental studies, we find that a leniency rule does not affect cartelization. We discuss potential explanations for this contrasting result.
Subjects: 
cartel
judgment of communication
corporate leniency program
price competition
experiment
JEL: 
C92
D43
L41
Document Type: 
Working Paper

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