The Output Effects of Government Sponsored Cartels During the New Deal

10 Pages Posted: 26 May 2002

See all articles by Jason E. Taylor

Jason E. Taylor

University of Virginia - Department of Economics

Abstract

This paper uses the National Industrial Recovery Act of 1933, which set up industry-wide cartels in the manufacturing sector of the US economy, to gain empirical insight into the current debate on the output effects of cartels. Recent theoretical studies have demonstrated ways in which cartels could expand, rather than reduce output as is traditionally thought. The New Deal cartel experiment does not support this "efficient cartel" view. On the contrary, the legislation brought about a reduction in manufacturing output, as traditional cartel theory would predict.

Suggested Citation

Taylor, Jason E., The Output Effects of Government Sponsored Cartels During the New Deal. Available at SSRN: https://ssrn.com/abstract=309192

Jason E. Taylor (Contact Author)

University of Virginia - Department of Economics ( email )

P.O. Box 400182
Charlottesville, VA 22904-4182
United States

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