tag:blogger.com,1999:blog-7342528022617501525.post2633230577417206041..comments2024-03-28T15:05:33.781+13:00Comments on Economics New Zealand: What should we do about 'cartels'?Donal Curtinhttp://www.blogger.com/profile/03687495556590450225noreply@blogger.comBlogger4125tag:blogger.com,1999:blog-7342528022617501525.post-51141663265826696622017-02-02T10:54:34.206+13:002017-02-02T10:54:34.206+13:00Thanks for your comments: it's good that compe...Thanks for your comments: it's good that competition, and potential impediments to it, are getting attention across the political spectrum. It's an important issue, and the voice of the consumer, who wants a good range of choice, struggles to get heard.<br />And I'm pleased to see (now that I've caught up with your original article - as I said I'm just back from holidays) that you think a market studies power for the Commerce Commission is a good idea. I've been banging on about this forever, for example here http://economicsnz.blogspot.co.nz/2016/08/time-to-kill-off-absurdity.html<br />and here<br />http://economicsnz.blogspot.co.nz/2016/11/good-ideas-but-now-what.htmlDonal Curtinhttps://www.blogger.com/profile/03687495556590450225noreply@blogger.comtag:blogger.com,1999:blog-7342528022617501525.post-14912329223259538952017-02-02T10:18:49.382+13:002017-02-02T10:18:49.382+13:00Thanks for the response. It's a tough one, isn...Thanks for the response. It's a tough one, isn't it, judging the prevalence of something where (in the worst cases) the participants are making strenuous efforts to remain undetected. I can't really comment in any detail on the names in your list, as I was involved with a fair few of them in my days at the Commerce Commission. But your point that some sectors seem more prone than others is apt: you might, for example, be interested in this 2008 OECD report on the construction industry https://www.oecd.org/regreform/sectors/41765075.pdfDonal Curtinhttps://www.blogger.com/profile/03687495556590450225noreply@blogger.comtag:blogger.com,1999:blog-7342528022617501525.post-87631630938123297162017-02-02T09:21:06.667+13:002017-02-02T09:21:06.667+13:00Thanks for the comments. My original article which...Thanks for the comments. My original article which prompted the NBR response is at http://www.nzherald.co.nz/politics/news/article.cfm?c_id=280&objectid=11787051 <br /><br />Research from the Productivity Commission and others shows that there here is a problem of high prices in NZ relative to other countries. As a small economy, we need to ensure that there is vigorous and fair competition, especially in sectors such as building supplies. Our regulators have a crucial role to play. Strong measures against hard core cartels is an important part of the regulatory mix, and it is disappointing that recommendations for criminalisation of hard core cartels has been weakened as a political judgement by this government.<br />Barry Coateshttp://www.greens.org.nznoreply@blogger.comtag:blogger.com,1999:blog-7342528022617501525.post-32268394028842908362017-02-01T21:45:41.984+13:002017-02-01T21:45:41.984+13:00The NBR also suggests that we lack domestic cartel...The NBR also suggests that we lack domestic cartels. This claim has been repeated by many seeking to argue that criminalisation isn't necessary.<br /><br />In my view it plainly hasn't been the case in the last 10 years, notwithstanding the significant Wood Chemicals penalties handed out circa 2005/6. I'll let readers decide, but a quick read of the Commission's media releases & enforcement register for warnings and prosecutions identifies domestic agreements (or attempted agreements) fairly described as cartel conduct in many industries: <br />- Pathology Services (2008)<br />- Elevator Maintenance (2008)<br />- Electricity (2009)<br />- Waste Oil Collection in 2009 AND 2015<br />- Interchange services (I know that will get some peoples blood boiling...)<br />- Online LED light sales (2010)<br />- Online tyre sales (2010)<br />- Air Ambulances (2011)<br />- Online bullion trading (2012)<br />- Taranaki Flooring (2013)<br />- Auckland Timber (2013/2014)<br />- Pharmacy services (2014)<br />- Animal Tracing (2015)<br />- Real Estate (2015)<br />- Metal Roof Flashings (2015)<br /><br />Now the small fish amoung these have resulted in warnings, and often aren't well known as a result. But many of these have been significant, and significantly punished. The various real estate cases penalties together are larger than the international cartels bar Air Cargo. <br /><br />A final thought: looking over that list I can't help but notice how frequently health services and building related products/services feature.Bnoreply@blogger.com