The Organization of Petroleum Exporting Countries (OPEC) is arguably the most successful cartel. Yet, it has not always been successful. What are the main reasons cartels, like OPEC, don't always succeed in creating the monopoly power they are trying to achieve
Answer - The main reasons are -
1 - OPEC has not been able to create the market power of its own and has to face the intense competitions from the non opec nations such as Canada , mexico , brazil etc.
2 - The members of the Cartel have the nature of cheating . This is done in order to earn the higher profits. As such there is lack of coordination between the Opec nations.
3 - The difference in the political situations in the Opec countries create the disturbances in the market and hence reduce the efficiency of this cartel.
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