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Essay / Research Paper Abstract
It is generally perceived that monopolies are bad for industry and result in many disadvantages for consumers and the companies themselves. This 3 page paper considers this perspective ad argues that there are some circumstances were monopolies may be advantages to all stakeholders and gives examples to support the arguments. The bibliography cites 4 sources.
Page Count:
3 pages (~225 words per page)
File: TS14_TEBenmon.rtf
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Unformatted sample text from the term paper:
or producer has total control over the market. The consumer has to buyer the prices and conditions set by the company. Good examples of monopolies include many of the power
companies prior to deregulation. In this consumers in the power companys area did not have a choice of provider as there was only one. The way in which they
operated was completely in their control as the consumer had no substitute, the product was perfectly inelastic, and as such when prices increased the consumers would have to continue paying.
The only way in which the sector could be influenced was by legislation or government pressure (Nellis and Parker, 1996). This means that the negative view is often seen as
the only view, however, there are some occasions where a monopoly may be seen in a positive light. To consider this we
need to look at the perspective that indicate monopolies are negative. The arguments against monopolies state that there no incentive to be efficient with their customers money. Therefore many
of these monopoly organisations are wasteful with their resources and do not look towards new innovations to gain a competitive edge, as they do not need to (Gisser, 1999). This
meant some monopolies would end up lagging behind technologically other similar industries in other countries where there was not a monopoly. This was also a disadvantage to the customers as
new innovations would often result in better cost savings or other potential advantages (Thompson, 2005). This model assumes that the way in
which a monopoly is not effective, and it is the aspect of competition that may be seen as the determining factor. Just because there is no competition it should not
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