The concept of "monopoly" is often found not only in economics, but also in everyday life. Let's figure out what exactly this type of competition is, give examples of monopoly, understand what advantages and what disadvantages a monopoly has and whether it exists at all.
What is Monopoly
Let's imagine that some enterprise is engaged in the production of unique products, which have no analogues in others. It is a unique product that creates a monopoly status for an enterprise, since it has no competitors. Let us conclude that a monopoly is an enterprise that fully controls the release of a unique product and its price, and also has no competitors due to the fact that others do not release this product.
Benefits of monopoly
One of the most important benefits is market control. If the oligopoly is equal to the price leader, then there is no need to be equal to anyone - you release products and set the price for it yourself. But setting it too high is unnecessary - as people will start looking for similar products with a low price. Moreover, the Antimonopoly Service, which controls the activities of monopolists, monitors this. Therefore, not everything is so simple - monopolies cannot set a high price or set conditions on others, they must comply with antitrust laws.
Disadvantages of monopoly
Probably, the control of the FAS is already a disadvantage for the monopoly, but compliance with the law is necessary. If you look at it from the other side, the lack of competition may be the disadvantage of monopoly, because if they exist, enterprises try to improve their product, thereby the development process is underway. If there is no one to fight with, then why change something. Do not assume that a unique product will not change over time - it will happen more slowly.
How to enter the monopoly market
It is very difficult. Usually monopolists are the largest enterprises, they do not just control the market, they can also easily crush competitors, especially newcomers. And small firms simply lack the power that a monopolist has. It is not profitable to have competitors, so it will not be difficult for a large company to crush a small enterprise. There are many ways to do this, but that's another topic.
Is there a monopoly? Examples of monopoly
Natural monopoly is rare in life. This is usually infrastructure. Let's give examples of monopoly, railroad (RZD). In fact, they are a monopoly in this area, since there are no other companies. Because of this, the quality of service does not improve. As trains traveled 50 years ago, so it is now. And modern ones are very expensive and travel only through Moscow and St. Petersburg.
