A cartel is a monopolistic Union firms

The Cartel – is an Association of several firms in the same industry, to regulate prices, conditions of sale, of spheres of influence, production volumes, the use of the patents, hiring of workers, conditions of sale of the goods. It can be attributed to the simple monopoly Union. Companies involved in the merger, shall retain their legal, operational, financial and commercial independence.

The Agreement of a large number of enterprises in the same industry – this is what, in fact, is a cartel. The definition of this concept was known several centuries ago. In Western countries such activities of companies is an economic crime, so the antitrust laws are actively fighting the cartels, identifying illegal enterprises. But in some States, such associations flourish and are even encouraged by the government to standardize materials, industrial restructuring and limit competition among small businesses.

In order to profitably distribute market, increase product prices, to set minimum wages, entrepreneurs and create a cartel. This agreement shall be signed by as many members as possible to eliminate possible competitors. Inside the cartels of a large firm dictate their terms to the smaller and unprotected, do not allow the parties to the agreement to lower commodity prices.

In market economies such associations exist in latent form, because antitrust law does not allow such activities. Distinguish between import, export, domestic and international agreements. The most simple is the domestic cartel. This Association of the same industry within the country. International assume joint activities of companies from different countries engaged in the import and export of products. Import cartels – importers of foreign goods, and the export – the national Association of exporting companies.

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Not to fall under antitrust regulations, these monopolistic enterprises became known as gentlemen's agreements, the Convention, the ring or corner, but the essence remains the same. Cartels in Russia is practically in every industry, and this has a negative impact on pricing. Experts notice that if there were no agreements between the producers, the prices would be reduced in 2-2,5 times.

Most Often the monopoly can be traced among oil companies in the telecommunications market, among the producers of medicines, food, coal, etc. the Government is doing everything possible to eliminate the cartels, but to close all the loopholes is very difficult and almost impossible. Therefore, the most effective method of struggle against dishonest entrepreneurs is the promotion of competition.

The Cartel – relatively short-lived Association, because some time between the parties to the conflicts, the balance is disturbed. The stability of an agreement depends on the possibility of inclusion or elimination of outsiders, lack of power, undermining the cartel from the inside.