TOPIC

CARTELS AND
MERGERS
Edvard Manukyan

business law in a digital context

Monopoly is not always a bad thing. There are cases when monopoly is regulated, and it exists in
favor of people. Regulation can be understood in a wide sense as the intervention of state entities
into the workings of market mechanisms in order to correct the conduct of market agents and, as
a result, the results of the market. This definition of regulation is applicable in a broad sense.
Some of the monopolies rise naturally (Conditions for Monopoly, n.d). For example, when a
company gets more customers, it is lowering the prices. Therefore, there will be no sense for
other companies to enter the market and compete.

Despite the fact that cartels are illegal in all countries, they do exist and serve a variety of
functions. Examples include price controls, contract regulations, restrictions on the volume of
goods produced, and more. OPEC is an excellent example of a cartel (The Organization of the
Petroleum Exporting Countries). The fact that OPEC was established by governments, as
previously stated, makes it lawful despite the fact that cartels are outlawed worldwide. Exxon
and Mobil are a good example of a merger. Merging businesses is mostly motivated by a desire
to save money.

Bibliography
Conditions for Monopoly. (n.d). Retrieved from Cliffsnotes.com:
https://www.cliffsnotes.com/study-guides/economics/monopoly/conditions-for-monopoly