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The standard model of optimal deterrence predicts that the probability of wrongful conviction of the innocent is, at the margin, as detrimental to deterrence as the probability of wrongful acquittal of guilty individuals. We extend the model in several directions: using expected utility as well...
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chooses to remain silent. Minimum-evidence standards may counteract this effect. Under a marker system only one firm reports …, our firms have imperfect cumulative evidence of the collusion. That is, cartel conviction is not automatic if one firm … reports: reporting makes conviction only more likely, the more so, the more firms report. Furthermore, the evidence is …
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