Cartel theory - Knowledge

478: 233:. It is not until about 1880 that the term "cartel" also means the restriction of competition between entrepreneurs. Initially, this usage was only spread in the German speaking countries in Europe. Only by and by, this novel word meaning was imported into neighboring languages (either as "Kartell" or "cartel") and by this the economic aspect became the predominant meaning of "cartel". In the 19th and 20th century, also social associations or political alliances were referred to as cartels, so the union of 574: 486: 718:. Abstracted from the concrete circumstances of the individual types of competition, an overarching theory of the social system 'cartel' emerges. Leonhardt defines this through nine basic statements on the factors arena, actors, interactions, structures, functions, equilibrium condition, driving forces, development path and system environment: Groups of independent, homogeneous actors are on certain arenas (action fields) on the way. Their egoism leads to 582: 734:: all members of a group want to benefit from it as well. The driving force that leads to cartel formation and successively condenses the associations on a development path to higher organizational forms is rationalization. The latter is only exhausted when an arena-wide organization has emerged and is fully developed, such as a 589:

Outside of the German speaking countries, there were more or less similar theories of economic organization. These variants existed until the 1920s (in Italy until after 1945). However, they operated with different basic terms such as (in French) "syndicat", "accaparement", (in Italian) "sindacati",

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as intergovernmental agreements: From the 17th to 19th centuries, there were agreements between (competing or belligerent) states on the maintenance of postal and commercial traffic, the entry and exit of couriers, prisoners of war and deserters. They also could deal with a more rational enforcement

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in the 1940s) It was based on the liberal view upon economy, which already had coined the traditional antitrust concept of the 1890s. The modern doctrine rejects cartels more or less fundamentally and is therefore not much interested in the internal organization of existing cartels, which are

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had condensed a number of case studies to the draft of an empirical theory. Cartel theory remained for decades the product, above all, of Central European economists of German tongue. That approach was well-intentioned to the entrepreneurial cartels and in this respect was functionalist and

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Terminologically, classical cartel theory has yielded sophisticated definitions and classifications of cartel types that were based on material institutional criteria. By contrast, modern cartel theory is essentially normative. Its specific terminology depends on the respective

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without freedom of choice between the partners would not be a (real) cartel. A suitable example is the "Deutsche Wagenbau-Vereinigung" (German Railway Cars Association), which was organized in the 1920s by the "Deutsche Reichsbahn" (German Imperial Railways) – its "market

161:. Even in the same languages, the spelling has varied over time. In German, for example, the spelling has gone back and forth between the c-initial form and the k-initial form. Nevertheless, "cartel" is the most widespread worldwide because of its use in English, 686:

sales strategies - are highlighted in the classic cartel theory. Thus, these two directions of cartel studies feature conflicting, mutually exclusive economic concepts and neither of them can ideally solve the fundamental problem of entrepreneurial competition.

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The alleged members of a suspected cartel do not know each other, but only randomly show a parallel behavior: “Cartels of the godless”, “cartels of maintenance deniers” or “silent cartels” are therefore usually no real cartels, but pure verbal abuse

201:, the English medieval law), the Italian "cartello" (diminutive of carta = paper, map) and the French "cartel" into the English and German language. In the Middle Ages, it designated an agreement on the fighting rules in the knightly 54:

and court games or in the form of inter-state fairness agreements, there was no scientific theory. Such has developed since the 1880s for the scope of the economy, driven by the need to understand and classify the mass emergence of

173:. Though there is no difference in meaning between "cartel" with a "c" and "kartel" with a "k", they are not always interchangeable. Some institutions and organizations differ in name mainly in this letter, like the 371:

Cartels are not always easy to spot. To be able to reliably distinguish them as alliances between rivals from other forms of organization, the consideration of positive and negative indicators can be helpful.

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cartels. Within the economic cartel theory, one can distinguish a classical and a modern phase. The break between the two was set through the enforcement of a general cartel ban after Second World War by the

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The members of a cartel are independent of each other, negotiating their interests with each other and against each other. So there have to be at least two participants and they determine their interests

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In 1883, an explanatory framework was based upon this novel understanding of "cartel": the classic cartel theory, which was in the same way of German origin: The Austro-Hungarian professor of economics

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on fairness rules and reconciliation of interests, e.g. by joint ventures. The adopted standards, agreements and projects need to be enforced and monitored, creating multi-stakeholder organizations –

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Labor union cartels ("Gewerkschaftskartelle") as associations of several trade unions of the same locality, so in Germany of the late 19th and early 20th century,

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of the 20th and 21st century, there was the same naming for party alliances, e.g. "Vlaams Kartel". At the beginning of the 20th century, the socialist thinker

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of the Customs regulations by the right of the border guard authorities to be allowed to enter the territory of the neighboring state to persecute smugglers.

902:: Cartels or competition? The economics of international controls by business and government (with M. W. Watkins). New York: Twentieth Century Fund 1948. 658:

Modern cartel theory points out - much more committed than the classical one - to the detrimental consequences of a lack of competition that leads to

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The union of competitors, in their entirety or via important members of its association, is dependent on an outside power. A strict, state-mandated

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is an ambiguous concept, which usually refers to a combination or agreement between rivals, but – derived from this – also designates

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and trade unions in some industrialized countries was not a cartel, because the allies there were no homogenous competitors.

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The members of a cartel know each other; they have a direct relationship, in particular they communicate with each other.

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The word "cartel" has its root in the Greek χάρτης (= papyrus scroll, paper, map) and came about the Latin "charta" (see

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Freiheit und Bindung in der geordneten Wirtschaft: Kartellgesetzgebung und Marktordnung in der gewerblichen Wirtschaft

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Les Syndicats industriels de producteurs en France et à l'Étranger. Trusts-Cartells-Comptoirs-Ententes internationales

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combated (and therefore only loosely institutionalized). Subsequently, modern cartel theory is quite oriented to pure

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The term ‘’cartel’’ is normally used in a specific context, resulting in a number of content variations. So there is:

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were named so. In modern times, especially in the 18th and 19th centuries, the term "cartel" was also used for

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Cartels between people, meant above all derogatory, e.g. the ‘cartel of the wicked' or the ‘silent cartel’,

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The modern cartel theory, which followed the classical cartel doctrine is essentially of American origin (

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The Development of Cartel Theory between 1883 and the 1930s - from International Diversity to Convergence

647: 618: 523: 182: 38:, doctrines on non-economic cartels are conceivable in principle. Such exist already in the form of the 614: 937: 539: 422: 581: 425:

can't be a "cartel" due to its central management, which controls its subsidiaries. Furthermore, an

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There is a "hierarchical" or other strong "dependency relationship among the participants": a drug

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in election campaigns, for example. The scientific analysis of cartels is done by cartel theory.

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Leonhardt: The development of cartel+ theory between 1883 and the 1930s. Hildesheim 2018, p. 15.

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a middle one, which was characterized by the introduction of more economic theory (especially

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aspects of the classical cartel theory did not find a continuation in modern cartel theory.

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The members are, at the same time, partners as well as competitors (so do e.g. enterprises,

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in the economy. In this context, this doctrine has helped to develop the paradigm of

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a late one that was influenced by the entry into the organized economy of the German

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of the state. There is no such instance in international relations, so that the

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takes place between actors of different levels. Thus, the concerted actions of

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The origin of the usage of 'cartel' for entrepreneurial co-operations was the

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following the depression of 1929-1933 (see, for example, Heinz Müllensiefen).

530:. The classic cartel theory itself went through three stages of development: 1068: