Working Paper No. 859

Trust, Leniency and Deterrence

Published: January 17, 2011, revised December 2014Pages: 38Keywords: Antitrust; Betrayal; Cartels; Collusion; Distrust; Fines; Leniency; WhistleblowersJEL-codes: C92; D03; K21; K42; L41
Published version

Trust, Leniency and Deterrence Maria Bigoni, Sven-Olof Fridolfsson, Chloe Le Coq and Giancarlo Spagnolo

This paper presents results from a laboratory experiment studying the channels through which different law enforcement strategies deter cartel formation. With leniency policies offering immunity to the first reporting party, a high fine is the main determinant of deterrence, having a strong effect even when the probability of exogenous detection is zero. Deterrence appears to be mainly driven by ‘distrust’; here, the fear of partners deviating and reporting. Absent leniency, the probability of detection and the expected fine matter more, and low fines are exploited to punish defections. The results appear relevant to several other forms of crimes that share cartels’ strategic features, including corruption and financial fraud.



Sick of Inequality?

An Introduction to the Relationship between Inequality and Health

Sick of Inequality.jpg

In this book Andreas Bergh, Therese Nilsson, IFN and Lund University, and Daniel Waldenström, IFN and Paris School of Economics, France, review the latest research on the relationship between inequality and health. What does inequality mean for our health? Does increasing income inequality affect outcomes such as obesity, life expectancy and subjective well-being?


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To present ongoing research informal brown-bag seminars are held on Mondays at 11:30 am. This is an opportunity for IFN researchers to test ideas and results.

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