![]() The online Britannica conceptualizes a monopoly implies an exclusive market possession by a product or service supplier for which there is no substitute. A monopoly is a market structure in which a single supplier produces and sells a given product or service. Government can establish it it can form naturally or by integration. In simple words, when one business controls the market or a sizeable percentage of the market, the business has a monopoly.Īccording to Irving Fisher, a renowned American neoclassical economist, a monopoly is a market in which there is the “absence of competition,” creating a situation where a specific person or company is the only supplier of a particular good/service. A monopolist is a price maker and can set the amount of the product it sells. What is a Monopoly?ĭefinition: A monopoly is a single firm controlling price and market with no existing competitor. However, many experts counter this claim because the monopoly can exploit the consumer by restricting production and variety or charging higher prices due to its ultimate power. Proponents of monopolies believe that monopolies are largely concerned with efficiencies of scale in production. For example, businesses can have a perfect system of buyers and sellers, monopolistic (one seller and many buyers), duopolistic (two sellers and many buyers), or oligopolistic (few sellers and many buyers) markets.Ī company has a monopoly if it is a profit maximizer, price maker, single seller, and practicing price discrimination in a market with a high barrier to entry. Market structures can be purely competitive. A market structure includes buyers and sellers and the forces of demand and supply.
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