People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.” That was Adam Smith, in The Wealth of Nations (1776). Typically, this is quoted in the context of joint producer behaviour, though politicians and trade unions behave no differently. “When I use a word, it means just what I choose it to mean — neither more nor less.” That was Humpty Dumpty, responding to Alice. In inflation-panic mode, we now have the hydra-headed government speaking in multiple voices, each head using words as it sees fit.

Steel Minister tells us there is a steel cartel, Finance Minister tells us there is cartel-like behaviour in steel and Minister of State for Steel tells us there is no evidence on cartels. To be strictly accurate, since a distinction is being drawn between cartels and cartel-like behaviour, Jitin Prasada didn’t tell us there is no evidence or information on cartel-like behaviour. Here is a formal definition of a cartel from The Economist magazine’s A-Z of Economics. “An agreement among two or more firms in the same industry to co-operate in fixing prices and/or carving up the market and restricting the amount of output they produce... Identifying and breaking up cartels is an important part of the competition policy overseen by anti-trust watchdogs in most countries, although proving the existence of a cartel is rarely easy, as firms are usually not so careless as to put agreements to collude on paper.”

... contd.