Optimal Antitrust Policy Under Different Regimes of Fines

In this paper, I completely characterize the optimal policy against price-fixings when the agency in charge of competition policy lacks information about the production cost of an industry. I consider two types of punishment. The first one consists in imposing a fine proportional to the total sales of the industry. The second one links the fine to the damage caused to the consumers. I show that the optimal policy has a typical shape in both cases. Finally, Icompare the two systems in terms of deterrence levels and efficiency. I show that for industries where possibilities of collusion are small, the first system dominates the second one in terms of efficiency. Conversely, for high possibilities of collusion the second one dominates.