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Subject: Monopoly Help

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Eric247

Newbie
Posts:8

21-03-2008 9:42 AM
Dear all, I'm required to do an assignment discussion on a monopoly industry (which I intend to choose the power/electricity industry) and explain why the government always attempts to prohibit the formation of monopolies but yet at the same time why do government still have monopolies in certain areas? Any suggestions and ideas are highly appreciated. Hope to hear some replies soon and have a pleasant day. Thanks in advance, Eric

Martin

Newbie
Posts:14

24-03-2008 10:35 AM
Eric: You should try to do three things. First, analytically contrast monopoly and perfect competition with the aid of a simple diagram in order to show that under monopoly, price is higher and output produced low (hence monopoly in less efficient. Secondly, explain the concept of 'natural monopoly'---closely related to the concept of a 'public good'. Third, give examples---and of course elaborate on an industry of your choice; eg, electricity or whatever. Any good introductory economics textbook will contain the essential analytics. Good luck.

RichardL

Newbie
Posts:8

26-03-2008 9:59 AM
hi eric, there is a lot of info out there for novice economists you just need the know-where to look tutor2u is prob the best place to get started, has a lot of up to date info and basically all areas of basic-degree level economics. To get you started on monopolies why not go here: http://www.tutor2u.net/sub_economics.asp and scroll to 'concetrated markets' it has everything you need I believe. Anyway hope that helps and goodluck!

Jonesy

Newbie
Posts:6

27-03-2008 1:03 PM
Eric, Martin has given to you very sound advice. In fact, you have the entire outline contained in his statements. Now, you just need to create a good thesis statement and use his suggestions as your topic sentences. Do this and your paper is finished.

Asterix

Newbie
Posts:19

03-04-2008 9:05 AM
The electric power companies are a good choice as an example. But instead of first approaching it from an economic perspective, look at it from a techological perspective. First of all electrons are all alike. Electricity is the flow of electrons. One power company cannot say that it's electrons are better than its competitors electrons. Well they can say it but it would be total nonsense. One company could conceivably provide more reliable service than another, more stable voltage, fewer failures, but this would require a separate power distribution system. Could you imagine wiring a major city with TWO or MORE electric power distribution systems. The expense of installing and maintaining two separate power distribution systems makes having anything other than a monopoly ridiculous. But of course the problem with a monopoly is the temptation to gouge the customers because there are no competitors, hence government regulation.

Benedictus User is Offline

Newbie
Posts:38

04-04-2008 9:00 AM
In economics, a government-granted monopoly (also called a "de jure monopoly") is a form of coercive monopoly in a government grants exclusive privilege to a private individual or firm to be the sole provider of a good or service; potential competitors are excluded from the market by law, regulation, or other mechanisms of government enforcement

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