In the late 1700s the London silk weavers of the Spitalfields district were faced with the breakdown of informal price setting and the imminent demise of their silk weaving cartel. This potential disruption to their livelihoods led to increasing levels of unrest in the Spitalfields community. To combat the unrest, the British Parliament passed the first of the Spitalfields Acts, which essentially formalized and legalized the cartel and price setting behavior. This reaction by Parliament is not unlike what is occurring today with modern occupational licensing laws. This case study encourages readers to think about the ways government intervention in markets can restrict competition and cause unintended consequences, and the implications such interventions can have for business owners and individuals participating in these markets.
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