Monopoly

monopoliesmonopolisticmonopolistmonopolizedmonopolistsmonopoly powermonopolizationmonopolizemonopolisedmonopolizing
A monopoly (from Greek μόνος and πωλεῖν) exists when a specific person or enterprise is the only supplier of a particular commodity.wikipedia
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Oligopoly

oligopolisticoligopoliesoligopolists
This contrasts with a monopsony which relates to a single entity's control of a market to purchase a good or service, and with oligopoly which consists of a few sellers dominating a market.
In some situations, particular companies may employ restrictive trade practices (collusion, market sharing etc.) in order to inflate prices and restrict production in much the same way that a monopoly does.

Monopoly price

monopoly pricing
Monopolies are thus characterized by a lack of economic competition to produce the good or service, a lack of viable substitute goods, and the possibility of a high monopoly price well above the seller's marginal cost that leads to a high monopoly profit.
A Monopoly price is set by a Monopoly.

Monopoly profit

monopoly priceMonopoly Profit § PersistencePersistence" in the ''Monopoly Profit'' discussion
Monopolies are thus characterized by a lack of economic competition to produce the good or service, a lack of viable substitute goods, and the possibility of a high monopoly price well above the seller's marginal cost that leads to a high monopoly profit.
In economics a monopoly is a firm that lacks any viable competition, and is the sole producer of the industry's product.

Natural monopoly

natural monopoliesinformation monopolymonopolist
Monopolies can be established by a government, form naturally, or form by integration.
A natural monopoly is a monopoly in an industry in which high infrastructural costs and other barriers to entry relative to the size of the market give the largest supplier in an industry, often the first supplier in a market, an overwhelming advantage over potential competitors.

Competition (economics)

competitionmarket competitioncompetitive market
Monopolies are thus characterized by a lack of economic competition to produce the good or service, a lack of viable substitute goods, and the possibility of a high monopoly price well above the seller's marginal cost that leads to a high monopoly profit.
The greater selection typically causes lower prices for the products, compared to what the price would be if there was no competition (monopoly) or little competition (oligopoly).

Monopsony

monopsonistmonopsoniesmonopsonistic
This contrasts with a monopsony which relates to a single entity's control of a market to purchase a good or service, and with oligopoly which consists of a few sellers dominating a market.
In the microeconomic theory of monopsony, a single entity is assumed to have market power over sellers as the only purchaser of a good or service, much in the same manner that a monopolist can influence the price for its buyers in a monopoly, in which only one seller faces many buyers.

Industrial organization

industrial economicsIndustrial Managementindustrial economy
In economics, the idea of monopoly is important in the study of management structures, which directly concerns normative aspects of economic competition, and provides the basis for topics such as industrial organization and economics of regulation.
It analyzes determinants of firm and market organization and behavior as between competition and monopoly, including from government actions.

Regulatory economics

economic regulationregulationeconomics of regulation
In economics, the idea of monopoly is important in the study of management structures, which directly concerns normative aspects of economic competition, and provides the basis for topics such as industrial organization and economics of regulation.
For example, in most countries, regulation controls the sale and consumption of alcohol and prescription drugs, as well as the food business, provision of personal or residential care, public transport, construction, film and TV, etc. Monopolies, especially those that are difficult to abolish (natural monopoly), are often regulated.

Market (economics)

marketmarketsmarket forces
This contrasts with a monopsony which relates to a single entity's control of a market to purchase a good or service, and with oligopoly which consists of a few sellers dominating a market.
However, market prices may be distorted by a seller or sellers with monopoly power, or a buyer with monopsony power.

State monopoly

government monopolystate monopoliesmonopoly
The government may also reserve the venture for itself, thus forming a government monopoly.
A government monopoly may be run by any level of government - national, regional, local; for levels below the national, it is a local monopoly.

Cartel

cartelsprice fixing cartelTrusts
Likewise, a monopoly should be distinguished from a cartel (a form of oligopoly), in which several providers act together to coordinate services, prices or sale of goods.
A single entity that holds a monopoly by this definition cannot be a cartel, though it may be guilty of abusing said monopoly in other ways.

Deadweight loss

dead-weight losslosses in efficiencycosts of taxation
If the monopoly were permitted to charge individualised prices (this is termed third degree price discrimination), the quantity produced, and the price charged to the marginal customer, would be identical to that of a competitive company, thus eliminating the deadweight loss; however, all gains from trade (social welfare) would accrue to the monopolist and none to the consumer.
That can be caused by monopoly pricing in the case of artificial scarcity, an externality, a tax or subsidy, or a binding price ceiling or price floor such as a minimum wage.

Barriers to entry

barrier to entryentry barrierbarriers
This is likely to happen when a market's barriers to entry are low.
Barriers to entry often cause or aid the existence of monopolies or give companies market power.

Coercive monopoly

coercive monopoliesTrade Coercioncoercive
A government-granted monopoly (also called a "de jure monopoly") is a form of coercive monopoly, in which a government grants exclusive privilege to a private individual or company to be the sole provider of a commodity.
A coercive monopoly is not merely a sole supplier of a particular kind of good or service (a monopoly), but it is a monopoly where there is no opportunity to compete with it through means such as price competition, technological or product innovation, or marketing; entry into the field is closed.

Standard Oil

Standard Oil CompanyStandard Oil TrustStandard Oil Co.
American Telephone & Telegraph (AT&T) and Standard Oil are often cited as examples of the breakup of a private monopoly by government.
Standard Oil Co. Inc. was an American oil producing, transporting, refining, marketing company, and monopoly.

Market power

pricing powerprice takerprice takers
Monopolies, monopsonies and oligopolies are all situations in which one or a few entities have market power and therefore interact with their customers (monopoly or oligopoly), or suppliers (monopsony) in ways that distort the market.
In extreme cases—monopoly and monopsony—the firm controls the entire market.

Marginal revenue

marginal revenue curve
By the assumptions of increasing marginal costs, exogenous inputs' prices, and control concentrated on a single agent or entrepreneur, the optimal decision is to equate the marginal cost and marginal revenue of production.
However, a monopoly determines the entire industry's sales.

Price discrimination

discriminatory pricingprice discriminateproduct versioning
If the monopoly were permitted to charge individualised prices (this is termed third degree price discrimination), the quantity produced, and the price charged to the marginal customer, would be identical to that of a competitive company, thus eliminating the deadweight loss; however, all gains from trade (social welfare) would accrue to the monopolist and none to the consumer. Price discrimination allows a monopolist to increase its profit by charging higher prices for identical goods to those who are willing or able to pay more.
In a theoretical market with perfect information, perfect substitutes, and no transaction costs or prohibition on secondary exchange (or re-selling) to prevent arbitrage, price discrimination can only be a feature of monopolistic and oligopolistic markets, where market power can be exercised.

Bell System

Bell Operating CompanyBell Operating CompaniesBell Telephone
The Bell System, later AT&T, was protected from competition first by the Kingsbury Commitment, and later by a series of agreements between AT&T and the Federal Government.
In 1913, the federal government challenged the Bell System's growing monopoly over the phone system under AT&T ownership in an anti-trust suit, leading to the Kingsbury Commitment.

Artificial scarcity

artificially smallexcessiveexpensive because of its rarity
The most common causes are monopoly pricing structures, such as those enabled by laws that restrict competition or by high fixed costs in a particular marketplace.

Perfect competition

perfectly competitiveperfect marketimperfect market
There are four basic types of market structures in traditional economic analysis: perfect competition, monopolistic competition, oligopoly and monopoly.
Economic profit is, however, much more prevalent in uncompetitive markets such as in a perfect monopoly or oligopoly situation.

Predatory pricing

price dumpingaggressive undercuttingdifferential and preferential railway rates
The so-called predatory merchant then theoretically has fewer competitors or even is a de facto monopoly.

Patent

patentspatent lawpatented
Patents, copyrights, and trademarks are sometimes used as examples of government-granted monopolies.
By the 16th century, the English Crown would habitually abuse the granting of letters patent for monopolies.

Herfindahl–Hirschman Index

Herfindahl indexHerfindahl-Hirschman IndexHerfindahl-Hirchman Index
The Herfindahl-Hirschman Index (HHI) is sometimes used to assess how competitive an industry is.
As such, it can range from 0 to 1.0, moving from a huge number of very small firms to a single monopolistic producer.

Monopolistic competition

monopolistically competitivemonopolisticmonopolistic competitors
There are four basic types of market structures in traditional economic analysis: perfect competition, monopolistic competition, oligopoly and monopoly.