Document Type

Article

Publication Date

Winter 2006

Abstract

The purpose of this article is to examine whether the current cartel fine levels of the European Union (EU) and the United States are at the optimal levels. We collected and analyzed the available information concerning the size of the overcharges caused by hard-core pricing fixing, bid rigging, and market allocation agreements. Data sets of United States cartels were assembled and examined. These cartels overcharged an average of 18% to 37%, depending upon the data set and methodology employed in the analysis and whether mean or median figures are used. Separate data sets for European cartels also were analyzed, which show overcharges in the 28% to 54% range. We similarly examined cartels that had effects solely within a single European country (which showed significantly lower overcharges, averaging in the 16% to 48% range).

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