cartel
kar-TEL
/kɑːrˈtɛl/
An association of independent manufacturers or suppliers formed to maintain prices at a high level and restrict competition.
Implies explicit, formal agreement among nominally separate market rivals to act like a collective monopoly.
The story behind the word. Originating from Italian 'cartello' (a small paper poster or written notice), the word originally referred to a written agreement between warring armies regarding exchange of prisoners. In late 19th-century Germany, the term 'Kartell' was adopted to describe written pacts between competing industrial manufacturers.
Word relationships
- syndicate: A syndicate is a general group combined to promote common financial interests, whereas a cartel specifically aims to stifle price competition.
- trust: A trust historically combined ownership under trustees, while cartel members remain independent corporate entities.
- free market: An open competitive economic environment without price manipulation or production quotas.
Commonly confused with
- oligopoly: An oligopoly is an industry market structure; a cartel is an explicit agreement between firms within that structure.
Word family
- cartelize (verb): To organize an industry into a cartel.
- cartelization (noun): The process of organizing suppliers into a cartel.
Collocations
- form a cartel
- break up a cartel
- cartel member
- drug cartel
Example sentences
- "OPEC operates as an international oil cartel, coordinating production quotas to influence worldwide crude oil prices." International trade journalism
- "Federal prosecutors uncovered a price-fixing cartel operating among international air cargo carriers." Legal prosecution
Memory hook
CARTEL = CARDS on the table. Rivals sit down to lay out written deals to keep prices high. Cartel = Secret price pact.
When not to use
Do not use to describe a single unified mega-corporation; a cartel requires multiple distinct firms cooperating.
Fun facts
- In late 19th-century Germany, industrial cartels were completely legal and enforceable in civil courts as valid business contracts.
Explore more words
monopoly, oligopoly, price-fixing, consortium, collusion, conspiracy
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