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Domestic Helps - The Oligopolists

ET Cases, 4 pages
AUTHOR(S) : Dr. Rajesh Gangakhedkar (Assistant Professor, Institute of Public Enterprise, Hyderabad), Dr. R.K. Mishra (Director, Institute of Public Enterprise, Hyderabad)

Case Preview

Domestic Helps – The Oligopolists


Revathi a very busy homemaker lives with her school going son, an educationist husband, Rajesh and ailing mother-in-law. Revathi’s day starts very early as she has to pack lunch for her husband and son, who preferred home cooked food for lunch at their workplace and school. Moreover, she also had to take care of her ailing mother-in-law.

For quite few years Revathi had a good helping hand, her domestic help Prema, who was more like a family member to her, as she helped her in her daily chores although not specified in her responsibilities. After Prema’s wedding, she had quit working as a domestic help and now Revathi was on the lookout for another domestic help to do the household chores of cleaning utensils, washing clothes, mopping, etc. Initially, she had asked Rajitha to work for her. Revathi sensed that Rajitha had quoted a very high salary. Revathi then tried talking to other domestic helps in her apartment, who demanded similar salary. Revathi did not relent and tried negotiating with few others. To her surprise all of them demanded almost same salary. Revathi surrendered and had to hire Rajitha finally, who tenaciously clung to the motto of ‘Not a Penny More, Not a Penny Less’. For the first few months the home functioned smoothly. Then matters began to get complicated. Rajitha frequently was absent from work, sometimes with information and many a times without intimation also..............

Assignment Questions

I. Explain the features of Oligopoly such as, Cartel and Collusion.
II. What are the types of Collusion?
III. Why do Cartels collapse?
IV. ..................

Teaching Note Preview

Domestic Helps – The Oligopolists


Oligopoly which is an example of an imperfect market, gives market power to a few sellers, to indulge in anti-competitive behavior. They can form a cartel, they can  collude and come to an understanding to fix price or restrict output. The domestic help episode provided an instance for Rajesh, to help his wife Revathi comprehend as to why the domestic helps, behaved in a particular way. Rajesh could explain as to why the market for domestic helps showed some features of Oligopoly market. The entire episode gave him a chance to develop it as a caselet to explain to his students, much more complex concepts of Oligopoly such as national and international cartels, collusion, national and international legislations to protect the buyers from the anti-competitive conduct of sellers in the Oligopoly market.

Expected Learning Outcomes

At the end of the discussion, participants should be well acquainted with:

  • • Features of oligopoly such as cartel and collusion
  • • Why few cartels collapse and others succeed
  • • National and international cartels


Prerequisite Conceptual Understanding (PCU)/Before the Classroom Discussion

The participants could be asked to read the following chapter to help them connect the concepts discussed in the caselet.

  • • Paul A. Samuelson, et al., “Patterns of Imperfection - Oligopoly”, Economics, 19th Edition (Special Indian Edition), McGraw Hill Education (India) Private Limited, 2014 – To understand the concepts/features of Cartels and Price Collusion


Case Positioning and Setting

  • • This caselet can be used to discuss the concept of Imperfect Competition/Features of Oligopoly in Micro-Economics for MBA


Assignment Questions

  • I. How does Oligopoly differ from perfect competition?
  • II. Explain the features of Oligopoly such as, Cartel and Collusion.
  • III. What are the types of Collusion?
  • IV. ...............


Case Analysis and Discussion

The discussion dashboard provided as Exhibit (TN)-I illustrates the broad sections of discussion in the classroom.....

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Product code: ME-2-0005, ME-2-0005A


Oligopoly as an example of imperfect market has been a subject of research by academicians for quite a long time. Examples from day-to-day life help comprehend the features of oligopoly such as Cartelization, Collusion, Price Fixation, Bid Rigging, easily. This caselet takes the example of the market of domestic helps and tries to examine whether the domestic helps behave like oligopolists? Do they form a cartel and collude? The caselet focuses on three features of oligopoly namely, Cartelization, Collusion, Cheating in Cartel.

Pedagogical Objectives

  • To examine whether the market for domestic helps shows oligopolistic tendencies
  • To understand the oligopoly features such as cartelization, collusion and cheating in a cartel
  • To discuss few national and international cartels

Case Positioning and Setting

This caselet can be used to discuss the concept of Imperfect Competition/Features of Oligopoly in Micro-Economics for MBA

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- Abstract
- Caselet
- Teaching Note (**ONLY for Academicians)

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