Cartels: a Good or a Bad Strategy?

Izabela Pop

MPRA Paper from University Library of Munich, Germany

Abstract: Any organization should seek the efficiency maximization, namely the achievement of an effect/effort ratio as high as possible. In order to apply this economic ground rule, some companies use strategies based on gaining a competitive advantage over competitors. In contrast, other companies choose lighter options to increase profitability. They apply strategies focused on agreements with competitors that aim to maintain prices at a certain level regardless of economic factors governing the market mechanism. The purpose of this paper is to highlight the positive and negative effects of cartels as a management strategy. In this regard, the first part of the article summarizes the most important theories about cartels and their characteristics, while the second part presents some European and Romanian cartels, based on data provided by the European Commission and the Competition Council. The final part presents the most important findings and conclusions but also some recommendations for future research.

Keywords: cartels; competition; strategies; development; price (search for similar items in EconPapers)
JEL-codes: L10 L12 M10 M21 (search for similar items in EconPapers)
Date: 2015-06
New Economics Papers: this item is included in nep-com, nep-ind and nep-law
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Published in Economy-Innovation-Communication-University, 7th International Symposium Workshop – A cross cultural model 9.6(2015): pp. 29-38

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:67314

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