JEMTEC

Cartel is a formal or informal agreement among number of firms in an industry to restrict competition. These agreements may provide for setting minimum prices, setting limits on output or capacity, restrictions on non-price competition, division of markets between firms either geographically or in terms of type of product, or agreed measures to restrict entry to the industry to create a monopoly in a given industry. Generally, cartels operate within industries where the products are homogeneous in nature, have no substitute and consumer demand would remain more or less unaffected by the change in price of the products. For instance, in cement industry, consumers would continue to buy the product irrespective of its price as there is no substitute for cement in construction. Some of the harm inflicted by cartels on the economy and the general public may include:   1)       Consumers being forced to pay higher prices for goods or service or alternatively, consumers being unable to