An alliance is when a group of countries work together in some way.

In a selling alliance countries co-operate by

• Agreeing to limit the production of a good that all the countries produce - this creates a shortage, which pushes up the price
• Agreeing not sell the good for less than a minimum price

An example of a selling alliance is O.P.E.C. - the Organisation of Petroleum Exporting Countries. In the early 1970's it managed to push up the price of oil by controlling how much oil was made available to other countries.

Selling alliances can only work if all the main producers of the goods stick to the agreed production levels and prices. Otherwise countries will undercut each other in an attempt to sell more of their good, and this brings the price of the commodity down.