![]() ![]() Under this definition of the term, it is not surprising that "monopoly" took on connotations of sinister interest and tyranny in the public mind. This definition of monopoly goes back to the common law and acquired great political importance in England during the sixteenth and seventeenth centuries, when an historic struggle took place between libertarians and the Crown over the issue of monopoly as opposed to freedom of production and enterprise. There is no way to determine this externally.Ī monopoly is a grant of special privilege by the State, reserving a certain area of production to one particular individual or group. Only consumers can determine what is an individual good. t may happen that no price whatever can be realized for his stuff and that his books can only be sold at their waste paper value." Mises notes, "Except for certain raw materials, foodstuffs, and other staple goods, monopoly is everywhere on the market." However, he also notes that this does not necessarily give rise to a monopoly price although "nder copyright law every rhymester enjoys a monopoly in the sale of his poetry. This definition, therefore, labels all consumer distinctions between individual products as establishing "monopolies." The owner of the Empire State Building is a "monopolist" over the rental services in his building. John Jones, lawyer, is a "monopolist" over the legal services of John Jones Tom Williams, doctor, is a "monopolist" over his own unique medical services, etc. It means that, whenever there is any differentiation at all among individual products, the individual producer and seller is a "monopolist". Any man can set any price that he wants for any quantity of a good that he sells the question is whether he can find any buyers at that price.Īll producers have absolute control over the quantity they produce and the price which they attempt to get and absolute noncontrol over the price-and-quantity transaction that finally takes place. "Monopoly exists when a firm has control over its price."įirms never have control over their prices, because every exchange is a voluntary transaction subject to market forces. According to Ludwig von Mises, this type of monopoly "has no reference whatever to a market economy." A world-embracing socialist state would exercise such an absolute and total monopoly it would have the power to crush its opponents by starving them to death. Such a monopolist has the power to starve to death all those who do not obey his orders. "A state of affairs in which the monopolist, whether an individual or a group of individuals, exclusively controls one of the vital conditions of human survival." There is, in fact, enormous vagueness and confusion on the subject. Definitionsĭespite the fact that monopoly problems occupy an enormous quantity of economic writings, little or no clarity of definition exists. ![]() A monopoly is an enterprise that is the only seller of a good or service. ![]()
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |