A Cartel that Lasts for Centuries: The Case of the Eastern Orthodox Church Indulgences

36 Pages Posted: 8 Jun 2012 Last revised: 13 Jun 2012

Kostas Axarloglou

ALBA Graduate Business School

Christos Cabolis

IMD World Competitiveness Center; ALBA Graduate Business School; Yale SOM International Center for Finance

Nikolaos Chrissidis

Southern Connecticut State University

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Date Written: April 3, 2012

Abstract

In this paper, we present a non-conventional case of collusive behavior and tactics that last for centuries. In particular, we focus on the process through which the Patriarchates of the Eastern Orthodox Church (specifically, those of Constantinople, Jerusalem, Antioch, and Alexandria) distributed indulgences to believers in their jurisdictions during the period between the sixteenth and the seventeenth centuries. By employing a wide variety of primary sources such as correspondence among the various patriarchates and among individual clerics, printing orders for indulgences, and income-expenditure records, among others, we present evidence of oligopolistic interaction and behavior among the various Patriarchates in the distribution of indulgences. The observed long-duration of this collusive structure is the outcome of high barriers to entry, well defined market segmentation, effective monitoring, a strong enforcement mechanism and finally no product innovation. Overall, the data suggest that, besides their spiritual importance, indulgences were promoted in a way that resembles very much the distribution method and process of any typical product in a modern market economy.

Keywords: Cartel, Collusive behavior, Indulgences, Oligopolistic interaction, Regulation

JEL Classification: A12, D12, L4, L43

Suggested Citation

Axarloglou, Kostas and Cabolis, Christos and Chrissidis, Nikolaos, A Cartel that Lasts for Centuries: The Case of the Eastern Orthodox Church Indulgences (April 3, 2012). Available at SSRN: https://ssrn.com/abstract=2065923 or http://dx.doi.org/10.2139/ssrn.2065923

Kostas Axarloglou

ALBA Graduate Business School ( email )

Athinas Ave. & 2A Areos Str.
Vouliagmeni 166 71, Athens
Greece
+3010 896 4531 (Phone)
+3010 896 4737 (Fax)

HOME PAGE: http://www.alba.edu.gr

Christos Cabolis (Contact Author)

IMD World Competitiveness Center ( email )

Ch. de Bellerive 23
P.O. Box 915
CH-1001 Lausanne
Switzerland
+41 21 618 0742 (Phone)
+41 21 618 0707 (Fax)

ALBA Graduate Business School ( email )

6-8 Xenias Street
Athens, 115 28
Greece
+30 210 896 4531 (Phone)
+30 210 896 4737 (Fax)

HOME PAGE: http://www.alba.edu.gr/faculty/Pages/Cabolis.aspx

Yale SOM International Center for Finance ( email )

135 Prospect Street
P.O. Box 208200
New Haven, CT 06520-8200
United States
203-432-7108 (Phone)
203-432-8931 (Fax)

Nikolaos Chrissidis

Southern Connecticut State University ( email )

New Haven, CT 06515
United States

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