What determines cartel success
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What determines cartel success?. …a wide variety of variables!. Source: Margaret C. Levenstein, Valerie Y. Suslow: Breaking Up Is Hard to Do: Determinants of Cartel Duration. structural variables. - variance in and concentration of demand, - the structure and homogeneity of costs,

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What determines cartel success?

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What determines cartel success

What determines cartel success?

…a widevariety of variables!

Source: Margaret C. Levenstein, Valerie Y. Suslow: Breaking Up Is Hard to Do:

Determinants of Cartel Duration


What determines cartel success

structural variables

- variance in and concentration of demand,

- the structure and homogeneity of costs,

- the rate of technological change

Etc.

organizational factors

  • - distribution of power within the cartel,

  • its voting structure,

  • the sophistication of mechanisms for detecting and deterring cheating,

  • the ability of the cartel itself to create barriers to entry

  • etc

external factors

- government regulation

-anti-trust enforcement


What determines cartel success

idiosyncratic and history-dependent

determinants

  • - how quickly the organization learns about cartel design,

  • the start-up costs of creating the cartel

  • the reputation of cartel members

  • Etc.


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