Fragmented excluded traders cannot coordinate to break a cartel

Evidence

But collectively they have taken no action. Perhaps, being so numerous, they cannot coordinate, or perhaps each has an interest in joining the cartel individually but not in collaborating to promote competition, for then no single dealer could be sure of profiting. — Diego Gambetta, The Sicilian Mafia The Business of…, 563

Categorization

  • XREF: Anti-collective-action logic — each dealer prefers individual inclusion to collective competition — mirrors Olson’s logic of collective action and the free-rider problem.