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# Exclusive Corporation

## Definition

A legally privileged trading organisation that restricts membership and limits competition within its trade, enabling members to maintain higher prices and profits than would prevail under free market conditions.

## Source Chapter

Book I, Chapter 10

## Context

Smith criticises exclusive corporations as mechanisms that weaken the natural discipline of the market by protecting members from competition. He argues that when workers must be employed regardless of performance, quality deteriorates and consumers suffer, while the public interest is sacrificed to private gain.

## Economic Domain

Regulation

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