The growth of capitalism and its emphasis on the free play of competition reinforced the idea that monopolies were unlawful. With the Industrial Revolution of the early nineteenth century, economic production and markets exploded. In 1623, Parliament enacted the Statute of Monopolies, which prohibited all but specifically excepted monopolies. By the early seventeenth century, the English courts began to void monopolies as interfering with free of trade. The holders of such rights, usually the English guilds or inventors, dominated the market. In England, a monopoly originally was an exclusive right that was expressly granted by the king or Parliament to one person or class of persons to provide some service or goods. HistoryĮconomic monopolies have existed throughout much of human history. Moreover, it is assumed that competition enhances material progress in production and technology while preserving democratic, political, and social institutions. These laws are based on the belief that equality of opportunity in the marketplace and the free interactions of competitive forces result in the best allocation of the economic resources of the nation. antitrust laws prohibit monopolies and any other practices that unduly restrain competitive trade. The owners of a monopoly have the power, as a group, to set prices, to exclude competitors, and to control the market in the relevant geographic area. law generally views monopolies as harmful because they obstruct the channels of free competition that determine the price and quality of products and services that are offered to the public. Monopolies may exist in a particular industry if a company controls a major natural resource, produces (even at a reasonable price) all of the output of a product or service because of technological superiority (called a natural monopoly), holds a patent on a product or process of production, or is otherwise granted government permission to be the sole producer of a product or service in a given area. In a monopoly, one or more persons or companies totally dominates an economic market. An economic advantage held by one or more persons or companies deriving from the exclusive power to carry on a particular business or trade or to manufacture and sell a particular item, thereby suppressing competition and allowing such persons or companies to raise the price of a product or service substantially above the price that would be established by a free market.
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