Liberty Discussion on Does Syndicate Hurts or Benefits the Public
Liberty Discussion is a program designed to engage and inform the core members on the ideas of free market economy and classical liberal ideas. Discussions are made on the contemporary issues (local or national) through free market perspective. Article is selected and shared within the members to prepare oneself for the program. The program is organized at the venue of Graduate Coach Biratnagar on every alternative Saturday (twice a month).
Our regular discussion was held on Feb 03, 2018 at the Graduate Coach. The topic for the discussion was “Does Syndicate Hurts or Benefits the Public”.
This week discussion flowed on the syndicate system of Nepal. The discussion started with looking in the syndicate system of Nepal. Some of the participants stated that syndicate system had led to create huge barrier entry for the new players in the market. Due to lack free and competitive market system. It is harming the consumers by keeping prices high.
Some other argued, we all know that Syndicate practice in transportation system is ubiquitous in all the region of our country. It has been half a decade since the Supreme Court issued a mandamus order to the government to end the syndicate system and void any kind of provision and agreement made earlier that promotes anti- competitive behavior. Likewise, other opined that governments at the behest of special interest groups create artificial entry barriers like licensing requirements, to protect them from competition.
Contrary to it, Discussants asserted that If there will be Syndicate system. Then it will control the number of transport for that government should take in charge for it. There was some argument on the development and innovation system. On the other hand, some put the cases that, when there are a limited number of service providers, Syndicate become likely. Restricted entry allows the players to coordinate among themselves and negotiate the terms for collaboration. The players tend to gain more from collaborating with each other, instead of competing. This will hurt the consumer and also economic growth sector.