We often hear people being dismissive about “conspiracy theories”. Yet one of the most eminent thinkers of the 18th century, who is often called the founder of economics (although there were others, see here), Adam Smith, knew that they were commonplace. Here is what he wrote in his famous book with the (abridged) title “The Wealth of Nations”:

People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices. 

– The Wealth of Nations, Book I, Chapter X. 

Most people who remember reading this however don’t know that the really interesting part comes after that. Smith goes on to say:

It is impossible indeed to prevent such meetings, by any law which either could be executed, or would be consistent with liberty and justice. But though the law cannot hinder people of the same trade from sometimes assembling together, it ought to do nothing to facilitate such assemblies; much less to render them necessary. A regulation which obliges all those of the same trade in a particular town to enter their names and places of abode in a public register, facilitates such assemblies. . . . A regulation which enables those of the same trade to tax themselves in order to provide for their poor, their sick, their widows, and orphans, by giving them a common interest to manage, renders such assemblies necessary. An incorporation not only renders them necessary, but makes the act of the majority binding upon the whole.

– The Wealth of Nations, Book I, Chapter X.

Regarding this, Sam Bowman of the Adam Smith Institute writes:

As Eamonn Butler has written, Smith’s point is that the only way businessmen can succeed in a ‘conspiracy against the public’ is if they are given protection by government regulation. If not, the pressures of competition will ensure that conspiring businesses are quickly undermined by their competitors.