A cartel is a formal agreement among firms in an oligopolistic industry.
Cartel members may agree on such matters as prices, total industry output, market shares, allocation of customers, allocation of territories, bid-rigging, establishment of common sales agencies, and the division of profits or combination of these. Cartel in this broad sense is synonymous with “explicit” forms of collusion. Cartels are formed for the mutual benefit of member firms.
The theory of “cooperative” oligopoly provides the basis for analyzing the formation and the economic effects of cartels. Generally speaking, cartels or cartel behaviour attempts to emulate that of monopoly by restricting industry output, raising or fixing prices in order to earn higher profits.
Source: OECD
Some statistics to feed the debate on the checks and balances of the EU antitrust enforcement system: any comments? (click on “read more” to get the formatting right) Cartel Cases Adjudicated by the General Court 1995-2005 (226) 2006-2009 (56) Full annulment 6% (14) 16% (9)* Partial annulment and/or reduction in fines 56% (127) 27%…
Welcome to our blog! I thought I would start my postings on U.S. developments with a broader point about recent U.S. case law in the antitrust area. Many of the most important U.S. judicial decisions in antitrust have been driven by judicial concern with aspects of the U.S. litigation process that are perceived by some…
