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Institutional Design and Antitrust Evidentiary Standards

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  • Andreea Cosnita-Langlais
  • Jean-Philippe Tropeano

Abstract

The purpose of this paper is to study the relative impact of public and private competition law enforcement on antitrust liability. We develop a model with asymmetric information during trial, where the number of cases filed depends on the amount of damages awarded and on the standard of evidence applied either by the public authority or by the judge. Our model predicts that higher damages result in a higher standard of evidence, which is not always welfare improving. We also show that public enforcement better incentivizes pro-competitive practices by allowing a lower standard of evidence. This may lead the public enforcement to outperform the private enforcement.

Suggested Citation

  • Andreea Cosnita-Langlais & Jean-Philippe Tropeano, 2015. "Institutional Design and Antitrust Evidentiary Standards," EconomiX Working Papers 2015-3, University of Paris Nanterre, EconomiX.
    • Handle: RePEc:drm:wpaper:2015-3
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    References listed on IDEAS

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    1. Hüschelrath, Kai & Peyer, Sebastian, 2013. "Public and private enforcement of competition law: A differentiated approach," ZEW Discussion Papers 13-029, ZEW - Leibniz Centre for European Economic Research.
    2. Sylvain Bourjade & Patrick Rey & Paul Seabright, 2009. "Private Antitrust Enforcement In The Presence Of Pre‐Trial Bargaining," Journal of Industrial Economics, Wiley Blackwell, vol. 57(3), pages 372-409, September.
    3. Hugh C. Briggs III & Kathleen D. Huryn & Mark E. McBride, 1996. "Treble Damages and the Incentive to Sue and Settle," RAND Journal of Economics, The RAND Corporation, vol. 27(4), pages 770-786, Winter.
    4. Besanko, David & Spulber, Daniel F, 1990. "Are Treble Damages Neutral? Sequential Equilibrium and Private Antitrust Enforcement," American Economic Review, American Economic Association, vol. 80(4), pages 870-887, September.
    5. Kai Huschelrath & Sebastian Peyer, 2013. "Public and Private Enforcement of Competition Law A Differentiated Approach," Working Paper series, University of East Anglia, Centre for Competition Policy (CCP) 2013-05, Centre for Competition Policy, University of East Anglia, Norwich, UK..
    6. Louis Kaplow, 2011. "On the Optimal Burden of Proof," Journal of Political Economy, University of Chicago Press, vol. 119(6), pages 1104-1140.
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    Cited by:

    1. Grajzl, Peter & Baniak, Andrzej, 2018. "Private enforcement, corruption, and antitrust design," Journal of Comparative Economics, Elsevier, vol. 46(1), pages 284-307.

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    More about this item

    Keywords

    antitrust; public and private enforcement; evidentiary standard.;
    All these keywords.

    JEL classification:

    • K21 - Law and Economics - - Regulation and Business Law - - - Antitrust Law
    • L41 - Industrial Organization - - Antitrust Issues and Policies - - - Monopolization; Horizontal Anticompetitive Practices
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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