Cartel

Examples of Cartel in the following topics:

• Drug Cartels

• Cartel Example

  • A cartel is a formal collusive arrangement among firms with the goal of increasing profits.
  • A cartel is an agreement among competing firms to collude in order to attain higher profits.
  • Game theory suggests that cartels are inherently unstable, because the behavior of cartel members represents a prisoner's dilemma.
  • Whether members of a cartel choose to cheat on the agreement depends on whether the short-term returns to cheating outweigh the long-term losses from the possible breakdown of the cartel.
  • Assess the role of competition and collusion in the formation of cartels

• Price Fixing

  • OPEC is perhaps the most important cartel in the world: the member countries come together to fix oil prices at levels beneficial to them.
  • When the agreement to control price is sanctioned by a multilateral treaty or is entered by sovereign nations as opposed to individual firms, the cartel may be protected from lawsuits and criminal antitrust prosecution.
  • This explains, for example, why OPEC, the global petroleum cartel, has not been prosecuted or successfully sued under US. antitrust law.
  • In April 2007 the European commission fined Heineken €219.3m, Grolsch €31.65m and Bavaria €22.85m for operating a price fixing cartel in Holland, totalling €273.7m (InBev, another brewer, was convicted for price fixing but escaped punishment) .
  • Heineken were fined €219.3m for their role in a price fixing cartel in Holland in 2007.

• Antitrust Laws

  • This revolves largely around avoiding cartels, or collaboration between the big players which would allow for market manipulation.
  • The Sherman Act dealt with avoiding or limiting the power of trusts, or essentially the creation of price-controlling cartels.

• The Energy Crisis

  • As other OPEC nations followed suit, the cartel's income soared.
  • Other cartel members also undertook major economic development programs.

• Price Leadership

  • Firms can collude explicitly, as in the case of cartels, but this type of behavior is illegal in many parts of the world.

• Why Governments Intervene In Markets

  • In an unregulated inefficient market, cartels and other types of organizations can wield monopolistic power, raising entry costs and limiting the development of infrastructure.

• Industrial Purchasing Behavior

  • In Summer 2011 Jim Cramer drew the public's attention to a corner of the oil market.the cartel of nonconsumers who are using oil futures as part of an investing strategy that includes endless attempts to corner the market for crudes in order to make fortunes for them. that's what they did in 2008 when they cornered it and took it to $147. we know the futures markets are thin for oil. almost all the execs on the show confirm to me these futures are unreliable and easily manipulated. the price can be the benchmark for real commerce, meaning they can make a lot of money so long as no one seeks to bust the cartel price.While Cramer points out frankly that this is a corner (calling into question the proper working of the free market), official sources avoid calling this situation a corner.

• National Security Policy

  • Security threats involve not only conventional foes, such as other nation-states, but also non-state actors, like violent non-state actors (al Queda, for example), narcotic cartels, multinational corporations and non-governmental organizations.

• Economic Stagnation

  • The sudden doubling of crude oil prices by OPEC, the world's leading oil exporting cartel, forced inflation up even higher, averaging 11.3% in 1979 and 13.5% in 1980.