Public and Private Control in Mass Product Industry: The by Patrizio Bianchi (auth.)

By Patrizio Bianchi (auth.)

This paper offers findings from a learn of the cement industries in France, Germany, Italy and the uk. Its function is to figure out, so far as is feasible, the level to which the constitution and function of every has been motivated through the regulate of the industry exercised by way of public auth­ orities, by means of the industries themselves, or by way of either performing jointly. The cement was once selected for its relative 'simplicity' and since it deals an excellent pattern of other public coverage ways to the rules of non-public markets. even if there are various significant elements complicating inter­ nationwide comparability, the is easy to examine since it has a rela­ tively homogeneous product derived from very spread-out uncooked fabrics and it makes use of simply bought expertise to the diffusion of which there are not any obstacles. the several nationwide industries mentioned all had an analogous heritage of personal law of the marketplace for the 1st 1/2 the 20 th century, in which time cartels proliferated, other than once they sometimes collapsed below the strain of rate slicing inspired by way of extra potential. because the moment international battle, even though, governments have differed of their method of industry legislation, and the 4 state experiences illustrate quite a number diverse methods which covers the French adventure of strict cost regulate as an device ofindustrial coverage, the Italian event of weaker fee regulate, a criminal cartelin the U. K.

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9 In many other countries the price of cement is subject to official price control. In 1950, prices were subject to Government control in Denmark, France, Italy, Netherlands, Norway and the UK. Controls were lifted in the 7. B. S. Yamey, The Restrictive Practices Court, The Judicial Process and Economic Policy, 1965 London. 8. That judgement induced a large debate; see A. Beacham, Some Thoughts on the CementJudgment, Economic1ournal June, 1962, with a reply by LB. R. Gould and A. Beacham himself in Economic Journal, 1963.

C. Davis, A Hundred Years of Portland Cement 1824-1924, London 1924 and Low Prices in the Portland Cement Industry, Board of Trade, London 1907 unpublished. 6. L. Cook, Effects of Mergers, Six Studies, London 1958. 36 BPCM with 16, their subsidiaries with 6 and other members with 22. Producers with a total of 14 works remained outside the Federation. The CMF tried to reach local price agreements, but with the expansion in output in the early 1920's there was a major new entrant in the form of the Home Group, renamed the Red Triangle Group.

The CMF's argument was that the existence of the agreement conferred on customers substantial benefits which would not be received in the absence of the agreement. It was argued that the most important of these benefit was that prices were lower than they would otherwise be. The CMF argued that there were seven benefits, namely: 1. Prices were lower than these which would prevail under free competition. It was argued first that efficiency was high and costs of members were similar. Secondly, the argument was put that manufacturers had been content with a return on capital of less than 10%, and that without the security of the agreement a figure of 15%-20% would be sought.

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