Tuesday, September 21, 2021

Cartel Activity and Recidivism

Cartel Activity and Recidivism

Research Handbook on Cartels (Edward Elgar, Peter Whelan, ed.)

 

Catarina M. P. Marvão

Technological University Dublin; Stockholm School of Economics - Stockholm Institute of Transition Economics (SITE)

Abstract

The existence and extent of recidivism have been highly debated in the last few years. This chapter examines the current theoretical, experimental and empirical literature on recidivism and related issues. It also presents novel evidence on: (i) the amount of recidivism in the EU between 1998 and December 2020 (up to 19% of cartel members, depending on how recidivism is defined); (ii) the trend of EU “leniency inflation” noticed by Marvão and Spagnolo (2018b), which is even steeper for multiple offending firms; and (iii) the ability of recidivists to use leniency programs strategically by rotating reports and using multi-market contact. While “true recidivism” seems to have been eliminated in the US (Werden et al., 2011), it appears to be on the rise in the EU. Although it represents only 2% of the cartel members, it should be interpreted as a lower bound estimate since many cartels may remain undeterred and undetected (Ormosi, 2013).

https://lawprofessors.typepad.com/antitrustprof_blog/2021/09/cartel-activity-and-recidivism.html

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