Co-operation and Collusion: Making the Distinction in Marketing Relationships
Westburn Publishers Ltd
Faculty of Business and Public Management
School of Finance and Business Economics
Co-operative relationships between organisations may create added value for the partners involved, but they can also pose a threat to the competitiveness of markets. This paper reviews the economic and legal frameworks of co-operative marketing relationships and seeks to distinguish these from collusive relationships. A model of development from competition to co-operation to collusion is proposed, in which definitions of collusion are continually evolving in response to environmental change. This paper seeks to reconcile the benefits accruing to businesses involved in co-operative relationships, with the possible welfare loss resulting from restrictive relationships. Conceptual frameworks underlying buyer-seller relationships are evaluated from the perspective of models of economic efficiency and legal frameworks. A number of recent cases are evaluated in the context of this discussion.