2006-12-18 15:51:17 · 11 answers · asked by Anonymous in Social Science ➔ Economics
Theoretical capitalism kills itself through the proliferation of monopolies, so in practice, capitalist systems enforce regulations that disband most monopolies. Capitalism calls for companies to earn as much profit as possible, and the best way to do that is to reduce the market to a monopoly.
2006-12-18 16:04:16 · answer #1 · answered by Anonymous · 0⤊ 0⤋
No the Capitalist system itself does not creat Monopolies but the companies who use the system are always looking for ways to form monopolies.Governments are very careful of this as it is traditional that fair competition produces the best all round results for capitalism.
2006-12-18 16:03:47 · answer #2 · answered by burning brightly 7 · 0⤊ 0⤋
By definition the capitalist system is against monopolies. It's all based on supply and demand and whoever can offer the best deal will make the money. Monopolies are created by government internvention and this is against the tenets of pure capitalism.
2006-12-18 15:54:31 · answer #3 · answered by avishtevi 2 · 0⤊ 0⤋
I think companies can and will from time to time, try and corner the market on something, but it's not the norm.
For a time, I would have called Microsoft a monopoly, as it controlled virtually all the personal computer operating system market. It still controls 90% or so. That's why the EU and the US government watch it and make sure it doesn't use it's position to do anything anti-competitive, like withold code to developers.
2006-12-18 18:10:09 · answer #4 · answered by Uncle Pennybags 7 · 0⤊ 0⤋
No, monopolies are market failures.
Ideally, the government will come in and break up a monopoly in order to encourage competition and keep prices low.
2006-12-18 15:59:32 · answer #5 · answered by Ooze90 3 · 0⤊ 0⤋
This is like asking - does the blood circulation system "try" to create clots? Obviously not. The circulation system is just blood flowing around. It does not "try" to create clots. Nor does it try to NOT create clots. It just flows - sometimes, for various reasons, clots form, sometimes they dont. Capitalism is like that - it just is. It doesn't "try" to do anything since it doesn't have a brain, or intelligence or anything to "try" to do stuff. Sometimes though, monopolies form for various reasons. Like clots in the circulatory system, they are dangerous and should be removed as soon as possible. Sometimes these removal efforts work (Standard Oil, AT&T) sometimes they don't (Microsoft).
2006-12-18 20:47:35 · answer #6 · answered by kingdom_of_gold 4 · 0⤊ 0⤋
Yes, capitalism does promote monopolies, but that's why there are regulations to hinder anti-competititive behaviour (such as monopolies).
Real capitalists believe in competiting on fair terms.
2006-12-18 16:01:26 · answer #7 · answered by Ivan 5 · 0⤊ 0⤋
The capatilist system promotes competition, not monopolies.
Competition promotes monopolies, as the best way to get the largest market share.
Rather queer, wouldn't you say?
2006-12-18 16:42:42 · answer #8 · answered by blakerboy777 3 · 0⤊ 0⤋
in a way it is, capitalism sometimes creates economies of scale which lead to monopolies...
2006-12-18 16:04:35 · answer #9 · answered by david 2 · 0⤊ 0⤋
What do you think the banking system is based on?
2006-12-18 18:09:39 · answer #10 · answered by Nikolas S 6 · 0⤊ 0⤋