Compulsory cartel

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A compulsory cartel or forced cartel is a cartel that is established or maintained by an administrative order or by a legal directive. The interference of policies on these associations of entrepreneurs of the same trade varied. It ranged from a mere decision to establish a cartel or to maintain an existing one, to a strict state control. [1]

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Disagreement over the nature of compulsory cartels

The understanding of “compulsory cartels” as “cartels” has always been disputed. [2] While the older cartel experts before the 1930s usually insisted in the free entrepreneurial will that constituted a “cartel”, later authors were more tolerant and accepted forced cartels as an exception. In recent times (2007), the economic-historian Jeffrey R. Fear took this stance of the “exception to the rule” that would not contradict the general nature of these organizations. [3] The cartel-historian Holm Arno Leonhardt has positioned himself more differentiated in 2013: Forced cartels that were embedded in a totalitarian planning economy or were by other means unable to realize their own will, should be regarded as organs or appendages of another system. [4] Thus, “compulsory cartels” without a permanent political influence could indeed constitute real “cartels”, while others being under strict control acted mainly as servants of an alien will.

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References

  1. Holm A. Leonhardt: Kartelltheorie und Internationale Beziehungen. Theoriegeschichtliche Studien, Hildesheim 2013, p. 144-145.
  2. Holm A. Leonhardt: Kartelltheorie und Internationale Beziehungen. Theoriegeschichtliche Studien, Hildesheim 2013, p. 146-155.
  3. Jeffrey R. Fear: Cartels. In: Geoffrey Jones; Jonathan Zeitlin (ed.): The Oxford handbook of business history. Oxford: Univ. Press, 2007, p. 271.
  4. Holm A. Leonhardt: Kartelltheorie und Internationale Beziehungen. Theoriegeschichtliche Studien, Hildesheim 2013, p. 164-165.
  5. Liefmann, Robert: Cartels, Concerns and Trusts, Ontario 2001 [London 1932], p. 267.
  6. Hausleiter, Leo (1932): Revolution der Weltwirtschaft. München, p. 200.
  7. Liefmann, Robert: Cartels, Concerns and Trusts, Ontario 2001 [London 1932], p. 268.