The Freerider and the Cartel: Siam and the International Tin Restriction Agreements, 1931–1941

Abstract

Resource cartels face a fundamental organizational problem. While production control can secure higher prices, these are enjoyed by all producers, regardless of whether they are members of the cartel or not. Those who take the benefits without making a contribution to its costs are freeriders, and they can destroy the conditions under which effective collective action is possible. If resource cartels are to make an important contribution to improving the terms under which peripheral nations participate in the world economy, it is important for them to find ways of resolving the freerider issue.