Can You Explain The Causes Of Monopoly?

1 Answers

Muhammad Abdullah786 Profile
The monopoly rises when a firm has a control over the specific raw material like, oil, gas, bronze, copper, gold and bauxite etc. The monopoly may rise when a firm possesses a certain technique of production or production rights of some particular product. As the case of some firm producing life saving drugs or some satellite has monopoly in telecasting the cable programme.The monopoly may emerge when government to avoid foreign competition issues lice to a particular firm regarding importation of a particular good. In this way such firm will be having monopoly.

Monopoly is also possible when government for the sake public welfare gives the production rights to a particular firm. Such type of monopoly is called natural monopoly. Such monopoly rises because the size of market does not allows that the number of producer should be more than one. Such monopolies are government controlled monopolies and deal with public utilities like gas, electricity, and telephone, water, sewage and water sanitation. The idea behind such monopolies is that the firm wills no exploited the consumer.
So we can say that under the monopolistic completion the ordinary one cannot be survive.

Answer Question