real life examples Flashcards
(20 cards)
example of collusion
Major UK supermarkets, including Tesco, Sainsbury’s, and Morrisons, colluded with dairy processors to increase the price of milk, butter, and cheese, supposedly to benefit farmers. This agreement cost consumers an estimated £270 million. Fines were issued after an OFT investigation.
examples of privatisation
British airways
Railways - 1990
BT
Royal Mail - partially in 2013, fully in 2015, sold for £1980 million
natural monopoly
london underground
sewerage + water networks - seven trent
nationalisation
Labour government currently renationalising railways after being privatised in 1990
emerging natural monopolies
Web Search
Messaging
E-Commerce
Taxi apps
Streaming services
Sharing economy
subsidy
Indian government subsidised food production to help with shortages
maximum price
uk university tuition = £9535 per year
ofgem on energy until oct 2024 - characteristics of a natural monopoly
railfairs - increase of 1pp above RPI
congestion charge
central london £11.50 daily
trade union success
NEU strikes lead to a 6.5% pay increase for teachers
external economies of scale
silicon valley usa
easier for other
companies to find tech workers
and collaborate
cut red tape
David Cameron’s coalition government launched the Red Tape Challenge in 2011
It aimed to review and reduce unnecessary regulations that were holding back businesses, especially small and medium-sized enterprises (SMEs)
policies to reduce wage differentials
equal pay act 2010
pay transparency with employers of 250+
30h free childcare subsidies
WISE (women in science and engineering)
shared parental leave of 50h split
deregulation
relaxation of licensing and entry rules in the banking sector
lead to challeneger banks emerging eg monzo who gained a banking lisence in 2017
mergers
success and failure
vodafone and three
lloyds and tsb made lloyds tsb to exploit EOS and compete with barclays + HSBC
asda and sainsburys - blocked due to increasing prices despite promising 10% decrease
minimum price
scotland has minimum price of 65p per unit
contestable oligopoly
supermarkets
EOS + non price competition
aldi and lidl keep prices cheap
aquisitioners
facebook/meta bought instagram for $1b
monopoly not being dynamically efficient
dividends are 96% water company profits
apple spent $110b on share buybacks in 2024
british gas CEO paid $8.2m
gov spending to reduce poverty
london workplace scheme provides advice + training for 20000 since 2007
divorce of ownership from control
Volkswagen emissions scandal (2015)
Managers approved the use of software to cheat on emissions tests.
ownership - german state + porsche
Outcome: Billions in fines and damage to brand reputation.
