Antitrust Sanctions and the Firm's Ability to Pay

Academic Article


  • Data on the amount of fines are matched to seven accounting measures of the ability to pay for a sample of 386 firms convicted of price fixing between 1955 and 1993. Measures of ability to pay range from fund flows from current operations to total equity (technical bankruptcy). Most firms had the ability to pay the actual fines imposed. In many instances, firms had the ability to pay a Beckerian optimal fine. The ease with which actual fines can be paid brings into question the adequacy of deterrence even in those cases where the crime is detected.
  • Authors

  • Plante, Catherine
  • Craycraft, JL
  • Gallo, JC
  • Publication Date

  • 1997
  • Has Subject Area

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