which can lead to inferior products and services and higher costs for buyers. While limiting competition, oligopolies and monopolies can operate unencumbered in the U.S. as long as they do not violateantitrust laws. These laws cover:
There are plenty of examples of duopolies in today's markets—Coca-Cola and Pepsi in the soda industry and Apple and Samsung in the smartphone industry are two of them. Duopolies are a form of oligopoly, and the biggest disadvantage of duopolies, oligopolies, and monopolies is that the compan...
Believing that monopolies are examples of extreme cases of capitalism is a myth. In centrally-controlled economies, monopolies are much more common. During the Soviet communist era and North Korea today, many more sectors had/have just one supplier compared to any capitalist economy. Conditions wher...
Today, as thirty and forty years ago, economists debate how much unemployment is voluntary, how much involuntary, how much is a phenomenon of equilibrium, how much a symptom of disequilibrium; how much is compatible with competition, how much is to be blamed on monopolies, labor unions, and ...
What is an Example of a Divestiture? Anti-trust regulatory pressure can result in a forced divestiture, typically related to efforts to prevent the creation of monopolies. One frequently cited case study for anti-trust divestitures is the break-up of AT&T (Ma Bell). In 1974, the U.S. Just...
Metcalfe’s Law formula is expressed as n2(the square of the number of users). Risks include increased privacy concerns and monopolies that stifle competition. How Metcalfe’s Law Works The definition of Metcalfe’s Law explains the value of a network based on the number of users. A network...
Economic theory says a monopolist earns premium profits by restricting output and raising prices. This only occurs after the monopolist prices out or legally restricts any competitor firms in the industry. However, there is mixed historical evidence that natural monopolies formed before the Sherman Anti...
Antitrust laws are regulations that encourage competition by limiting themarket powerof any particular firm. This often involves ensuring thatmergers and acquisitionsdon’t overly concentrate market power or formmonopolies, as well as breaking up firms that have become monopolies. ...