PRICE CARTEL Meaning and
Definition
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A price cartel is a form of collusive behavior where multiple companies or organizations in the same industry come together and agree to fix or manipulate the prices of their products or services. This type of illegal agreement is designed to restrict competition and boost profits for all participating members. Price cartels often involve a small group of market leaders, who hold a considerable market share and have the power to influence prices.
The primary objective of a price cartel is to eliminate price competition among its members, establishing a monopoly-like situation where they can collectively control market prices. This allows them to artificially inflate prices, limiting consumer choice and efficiency in the market. The participants may engage in secret meetings or discussions to reach an agreement on price levels, often involving illegal practices such as bid-rigging or market allocation.
The consequences of price cartels can be detrimental to both consumers and the overall economy. As prices are artificially higher, consumers may face reduced purchasing power and fewer options, leading to decreased consumer welfare. Moreover, price cartels can hinder the entry of new competitors into the market, stifling innovation and slowing economic growth. Authorities actively combat price cartels as they violate competition laws and suppress fair market conditions.
The formation and operation of price cartels are considered serious offenses in many jurisdictions, with significant penalties imposed on those found guilty. Regulators and competition authorities actively monitor markets to detect and dismantle cartels, promoting fair competition, and protecting the interests of consumers and the economy as a whole.
Common Misspellings for PRICE CARTEL
- orice cartel
- lrice cartel
- 0rice cartel
- peice cartel
- pdice cartel
- pfice cartel
- ptice cartel
- p5ice cartel
- p4ice cartel
- pruce cartel
- prjce cartel
- prkce cartel
- proce cartel
- pr9ce cartel
- pr8ce cartel
- prixe cartel
- prive cartel
- prife cartel
- pride cartel
- pricw cartel
Etymology of PRICE CARTEL
The word "price cartel" combines the terms "price" and "cartel" to form a compound noun.
1. Price: The term "price" originates from the Old English word "prīs", meaning "valor" or "worth". It evolved from the Latin word "pretium", which referred to the value or worth of something. Over time, "price" came to represent the monetary value assigned to a product or service.
2. Cartel: The word "cartel" comes from the Italian word "cartello", which means a "paper placard" or "poster". It was initially used to describe the placards or posters used to announce public proclamations or official notices. In the 19th century, the term began to be used in a business context referring to an agreement or association formed by businesses to control market prices, production levels, or to restrict competition.
