Author(s)

Jue-Shyan Wang, Yi-Shao Chen

Department of Public Finance, National Chengchi University, Taipei, Chinese Taipei.

The issues about antitrust laws are getting much attention nowadays. And many countries over the world adopt leniency policies to control the actions of cartels. We used a game-theoretical model to discuss the equilibrium of cartels under different antitrust laws. And we modify the model of Blum et al. [1] to analyze the equilibriums of firms under the different mechanisms of leniency policies. We find out that the value of fine will affect the existence of a cartel, and the recognitions of legitimacies for cartels are important as well. When the antitrust authorities ask firms to propose appliances in advance to let the cartels be legal, firms would incline not to become a cartel. It’s quite different from the other mechanism which firms can confess to the antitrust authorities after they’ve already become a cartel.

Cartel; Leniency Policy; Bayesian Nash Equilibrium

J. Wang and Y. Chen, "The Impact of Different Antitrust Laws on the Actions of Cartels," Theoretical Economics Letters, Vol. 2 No. 5, 2012, pp. 455-458. doi: 10.4236/tel.2012.25085.