Maintaining Open Markets in the Global Economy
Chapter 3: An International Perspective on Collusive Behaviour
I INTRODUCTION In their classic study Stocking and Watkins (1946: 3) observed that in the USA the term cartel ‘now commonly refers to international marketing arrangements’. The international emphasis was a reflection of the widespread resort to cartelisation in the inter-war period, often to try to alleviate the effects of world recession. The definition they used throughout their study was broad enough to include formal arrangements administered by a complex bureaucracy but also ‘gentlemen’s agreements or informal undertakings among business rivals’. Largely because of the encouragement or tolerance of cartels, the inter-war period has often been regarded as the heyday of international cartels. Some estimates suggested that as much as 40–50 per cent of international trade was cartelised or influenced by cartels (Rahl, 1981: 244). Equally dramatic was the widespread view that by the 1960s international cartels were no longer important. One distinguished observer concluded in 1968 that global cartels have ‘passed into history’ (Vernon, quoted in Rahl, 1981: 246). The growth of world trade, the renewed vigour of antitrust enforcement, as well as the adoption of antitrust by more countries, were all thought to have contributed to this development. Subsequent events, however, have shown that this happy state of affairs was comparatively short-lived. In 1997 the WTO reported that ‘there are some indications that a growing proportion of cartel agreements are international in scope’ (WTO, 1997: 40). By drawing on the antitrust records of just the EU and the USA, Evenett et al. (2001) were able to compile...
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