Business organisation and policy cartels and monopolies Essay

Business organisation and policy cartels and monopolies - Essay ExampleOn the other hand, purchasing cartels aim at purchasing raw materials for its members while the output determining cartels determine the quantity of output for each member unit as the name suggests (Sangla 2009, p.181).Without government intervention, an isolated monopolistic firm would provided exist in an ideal world. This is because most monopolistic firms make a lot of profits therefore encouraging the formation of rival firms. In the long run, the new firms break the monopoly. Most governments in the twenties embraced mergers and trade unions in key economical sectors such as chemical and metal industries (McTavish 2005, p.52). However, most of the railway line organizations preferred cartels to the other forms of trade convergence.After the World War II, the pedigree field developed utter(a) monopolies and restrictive practices, which had salient effects on business organizations (McTavish 2005, p.52) . Currently, it is only America in the whole world, which has non legalized cartel formation. One of the most popular cartels today is the organization of petroleum-exporting countries (OPEC). OPEC was established mainly to control the sum up of oil each member produced.Member units that form cartels always enjoy a wide pattern of benefits. Each member usually has a guarantee to earn fixed minimum profit which is not the case with other business institutions. In addition, all marketing and other secondary functions of the individual business organizations such as transportation, advertisement and marketing research are normally carried out by the cartels (Sangla 2009, p.181).In addition, the member firms also enjoy price control. Since, in working as a pool, the individual firms maturate monopolistic characteristics, they are in a position to charge the prices of their products at their own will.Conversely, the cartels and monopolistic