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Jonathan Tobin: Defending the Right to a Jewish State

Heather Hale: Compliment your kids without giving them big heads

Megan Shauri: 10 ways you are ruining your own happiness

Carolyn Bigda: 8 Best Dividend Stocks for 2015

Kiplinger's Personal Finance editors: 7 Things You Didn't Know About Paying Off Student Loans

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Densie Well, Ph.D., R.D. Open your eyes to yellow vegetables

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Rabbi Yonason Goldson: Clarifying one of the greatest philosophical conundrums in theology

Caroline B. Glick: The disappearance of US will

Megan Wallgren: 10 things I've learned from my teenagers

Lizette Borreli: Green Tea Boosts Brain Power, May Help Treat Dementia

John Ericson: Trying hard to be 'positive' but never succeeding? Blame Your Brain

The Kosher Gourmet by Julie Rothman Almondy, flourless torta del re (Italian king's cake), has royal roots, is simple to make, . . . but devour it because it's simply delicious

April 14, 2014

Rabbi Dr Naftali Brawer: Passover frees us from the tyranny of time

Greg Crosby: Passing Over Religion

Eric Schulzke: First degree: How America really recovered from a murder epidemic

Georgia Lee: When love is not enough: Teaching your kids about the realities of adult relationships

Cameron Huddleston: Freebies for Your Lawn and Garden

Gordon Pape: How you can tell if your financial adviser is setting you up for potential ruin

Dana Dovey: Up to 500,000 people die each year from hepatitis C-related liver disease. New Treatment Has Over 90% Success Rate

Justin Caba: Eating Watermelon Can Help Control High Blood Pressure

The Kosher Gourmet by Joshua E. London and Lou Marmon Don't dare pass over these Pesach picks for Manischewitz!

April 11, 2014

Rabbi Hillel Goldberg: Silence is much more than golden

Caroline B. Glick: Forgetting freedom at Passover

Susan Swann: How to value a child for who he is, not just what he does

Cameron Huddleston: 7 Financial Tasks You Should Tackle Right Now

Sandra Block and Lisa Gerstner: How to Profit From Your Passion

Susan Scutti: A Simple Blood Test Might Soon Diagnose Cancer

Chris Weller: Have A Slow Metabolism? Let Science Speed It Up For You

The Kosher Gourmet by Diane Rossen Worthington Whitefish Terrine: A French take on gefilte fish

April 9, 2014

Jonathan Tobin: Why Did Kerry Lie About Israeli Blame?

Samuel G. Freedman: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Jessica Ivins: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Kim Giles: Asking for help is not weakness

Kathy Kristof and Barbara Hoch Marcus: 7 Great Growth Israeli Stocks

Matthew Mientka: How Beans, Peas, And Chickpeas Cleanse Bad Cholesterol and Lowers Risk of Heart Disease

Sabrina Bachai: 5 At-Home Treatments For Headaches

The Kosher Gourmet by Daniel Neman Have yourself a matzo ball: The secrets bubby never told you and recipes she could have never imagined

April 8, 2014

Lori Nawyn: At Your Wit's End and Back: Finding Peace

Susan B. Garland and Rachel L. Sheedy: Strategies Married Couples Can Use to Boost Benefits

David Muhlbaum: Smart Tax Deductions Non-Itemizers Can Claim

Jill Weisenberger, M.S., R.D.N., C.D.E : Before You Lose Your Mental Edge

Dana Dovey: Coffee Drinkers Rejoice! Your Cup Of Joe Can Prevent Death From Liver Disease

Chris Weller: Electric 'Thinking Cap' Puts Your Brain Power Into High Gear

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April 4, 2014

Rabbi David Gutterman: The Word for Nothing Means Everything

Charles Krauthammer: Kerry's folly, Chapter 3

Amy Peterson: A life of love: How to build lasting relationships with your children

John Ericson: Older Women: Save Your Heart, Prevent Stroke Don't Drink Diet

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Cameron Huddleston: Best and Worst Buys of April 2014

Stacy Rapacon: Great Mutual Funds for Young Investors

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The Kosher Gourmet by Sharon Thompson Anyone can make a salad, you say. But can they make a great salad? (SECRETS, TESTED TECHNIQUES + 4 RECIPES, INCLUDING DRESSINGS)

April 2, 2014

Paul Greenberg: Death and joy in the spring

Dan Barry: Should South Carolina Jews be forced to maintain this chimney built by Germans serving the Nazis?

Mayra Bitsko: Save me! An alien took over my child's personality

Frank Clayton: Get happy: 20 scientifically proven happiness activities

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Lecia Bushak: Why Hand Sanitizer May Actually Harm Your Health

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The Kosher Gourmet by Steve Petusevsky Exploring ingredients as edible-stuffed containers (TWO RECIPES + TIPS & TECHINQUES)

Jewish World Review Feb. 4, 2008 / 28 Shevat 5768

Price fixing

By Rabbi Dr. Asher Meir


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http://www.JewishWorldReview.com | Q: Some merchants in my area have agreements to fix prices. Is this ethical?


A: The Talmud relates the following incident of collusion which took place in Babylonia about 1500 years ago:


Two slaughterers made a deal that if either would work on the other's [designated] day, [the other] could tear up the hide. One of them went and worked on the other's day, and he came and tore up the hide. They went before [the judge] Rava, and Rava made him liable to pay [for the damage]. Rav Yeimar bar Shlamia objected to Rava based on the law, "They [community members] may establish punishment on their regulations". . . Rav Pappa said . . that's only if there is not great person, but if there is a great person they don't have the authority to make this condition.


The full explanation is as follows: The two slaughterers agreed to limit competition by dividing up the days of the work week between them. They also agreed on an enforcement mechanism. Since Jewish law views a profession or guild as an autonomous community with the right to make and enforce rules and regulations, Rabbi Yeimar assumed that this agreement was binding. (Evidently the two slaughterers were the only ones in town and were thus considered like a small guild.) But Rav Pappa pointed out wherever there is a recognized authority, any such agreements are subject to the approval of this "great person" — in this case, Rava.


Jewish law doesn't have a blanket prohibition against fixing prices and wages; skilled artisans are allowed to make regulations intended to advance their field and this may include prices. However, these regulations are subject to mandatory oversight to ensure they are consistent with the public interest; otherwise they are null and void. Note that Rava didn't merely order the two to cease their agreement; he ruled that it was void and that the enforcement mechanism was invalid and considered a tort. Likewise, Rav Pappa doesn't say that Rava has the authority to nullify the condition; he states that there is no authority to make the condition in the first place given the presence of someone capable of exercising oversight.


Nowadays this oversight function is fulfilled by antitrust commissions. Price fixing among retailers is among the kinds of restraint of trade forbidden by antitrust regulations and enforced by the law. So such agreements would violate the condition requiring prior approval of a duly authorized overseer. In the hypothetical case of an autonomous Jewish community they would need prior approval of the local Jewish court or Beis Din.


Another relevant consideration here is that only members of a trade are considered an autonomous community. This makes sense because we want to encourage them to work together, promote advanced standards and training, and thus develop their unique skills But it is questionable of retailers would be considered a community at all. So even in the absence of an authority I don't believe that retailers would be empowered to enforce any kind of price fixing agreement.


There is some solace in the fact that most price-fixing agreements of this nature fall apart eventually, as the temptation to defect becomes great. But the customer certainly loses in the meantime, and even when the arrangement becomes rickety prices are still affected. (Some secret cartels, like that between Westinghouse and GE in the 1950's, can last successfully for years.)


Conclusion: Jewish law confirms that any price regulation among retailers should be subject to appropriate regulatory oversight to ensure that it does not oppose the public interest.

SOURCES: (1) Babylonian Talmud, Bava Basra 9a

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JWR contributor Rabbi Dr. Asher Meir, formerly of the Council of Economic Advisers in the Reagan administration, is Research Director of the Business Ethics Center of Jerusalem, Jerusalem College of Technology. To comment or pose a question, please click here.

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