Leniency Program: A New Tool in Competition Policy to Deter Cartel Activity in Procurement Auctions

This paper discusses the impact of a leniency program on incentives within cartels. The objective of this program is to encourage a cartel member to confess and implicate his co-conspirators with hard evidence about their collusive agreement. We develop a simple model of cartel behavior under a first-price sealed-bid procurement auction and we show how an effective leniency program can prevent the internal coordination of cartel members.     

The Confidence Game: Of Others and of Bernard Madoff

This is the first in a series of five articles focusing on how Bernard Madoff’s confidence game (con game) worked. This paper first examines three con games in order to isolate their common elements. What went on in Madoff’s offices is generally what goes on in most con games: extensive preparations, elaborate props, pretense, victims convinced that they have much to win and little to lose, greed, and the ability to disorient and fool. Little in Madoff’s world was what it seemed to be.