freediver wrote on Feb 24
th, 2016 at 7:30pm:
Quote:All monopolies are imposed. I can’t think of one that isn’t. Can you?
Plenty of industries are natural monopolies. The government tends to hang on to a lot of them - eg utilities, roads, airports etc. These would still be monopolies without government control. Some not - eg software. Microsoft windows is a good example. All you have to do is make software that does something unique and you have a monopoly. You can set the price to milk as much as possible from your customers, and anyone considering investing in setting up a competing product risks the liklihood that you will just set your price lower and send them bankrupt. Your marginal cost of production is close enough to zero.
Introductory microeconomic theory goes through all the causes of natural monopolies - often framed as the requirements or assumptions behind a free competitive market place.
Quote:Governments in developing economies all impose monopolies. We did it, Uncle and Mother did it, and Suharto definitely did it.
When was the last time 'we' did it?
See above. Governments shape "natural" monopolies all the time. If I remember riggtly, it was a government contract thatgave Microsoft its leg up to establish a monopoly.
The most common way, however, is political donations and lobbying for legislation or contracts.
Look at the way Clubs Australia and the AHA kept their cushy pokie deal. Or the way Packer got the license for Lotto. Or the taxi industry fought to keep out Uber.
Only one of these is a real monopoly, but these are all ways people establish a hold over their market share.
Most of the time, it never makes the news.