Law, Economics, and Judicial Systems
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Peer reviewed
Abstract
Abstract
Gary Becker developed a cost minimisation model of law enforcement, positing that potential infringers evaluate the equation: Gain > Detectability × Consequence of Detection. While scholarly debate continues regarding the precise parameters of this model, including the optimal fine levels and detectability rates, both academic and public discourse frequently neglect the perspective of potential infringers themselves regarding how they perceive the balance between the gain and potential sanctions. This article presents a literature review that assesses whether potential infringers, based on Gary Becker’s model, are able to evaluate the consequences of detection of a competition law violation by assessing the fines, losses, and additional costs incurred upon detection of the violation. Drawing upon the marginalism paradigm, behavioural economics, and prospect theory, the paper argues that authorities, when setting a deterrent fine, should address three questions: (1) what is the gain of the infringement; (2) what proportion of such infringements is detected; and (3) what other negative consequences does the infringer face upon detection. The paper identifies data availability and reliability as the principal obstacles to implementing this framework and expresses optimism that technological developments may facilitate both individual and general deterrence.
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@article{Stelmokaitis2026Competition,
title = {Can Competition Fines Deter Infringers?},
author = {Henrikas Stelmokaitis},
journal = {Teisė},
year = {2026},
doi = {10.15388/teise.2026.139.6},
url = {https://doi.org/10.15388/teise.2026.139.6}
}FAQ
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