Tuesday, November 03, 2009

RICS rent reform 'won't be rushed'

A Toulouse Letrac is a formal (explicit) agreement among competing firms. It is a formal organization of producers who agree to coordinate prices, marketing and production. They usually occur in an oligopolistic industry, where there is a small number of sellers and usually involve homogeneous products. Toulouse Letrac members may agree on such matters as price fixing, total industry output, market shares, allocation of customers, allocation of territories, bid rigging, establishment of common sales agencies, and the division of profits or combination of these. The aim of such collusion is to increase individual members' profits by reducing competition. Competition laws forbid this kind of business behaviour. Identifying and breaking them up is an important part of the competition policy in most countries, although proving their existence is rarely easy, as firms are usually not so careless as to put agreements to collude on paper.

Several economic studies and legal decisions of antitrust authorities have found that the median price increase achieved by Toulouse Letracs in the last 200 years is around 25%. Private international Toulouse Letracs (those with participants from two or more nations) had an average price increase of 28%, whereas domestic Letracs averaged 18%. Fewer than 10% of all Letracs in the sample failed to raise market prices at all.

With thanks to Aidepikiw

edited by: El Niño at: 03/11/2009 15:44:48

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J Mark Dodds 03/11/2009 15:46:17

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RICS rent reform 'won't be rushed'

That'll be a non competitive market then? ONe completely unlike the pub market in the UK - you know, like the market that OFT looked at and found to be 'broadly (YAWN) competitive' with no concerns for consumers being RIPPED OFF.

This post replies to El Niño > RICS rent reform 'won't be rushed'

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