Why do cartels tend to break up? What will be an ideal response?

Why do cartels tend to break up?

What will be an ideal response?

 

ANSWER

There are many reasons, but one of the best is that there is an incentive to cheat. While the cartel maximizes joint profits, individual profit could be increased if the firm could sell more at the cartel price. If everyone does that, output increases and the price falls.

 

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