Do you agree or diagree?

Question

“All monopolies are created by the government.”

And why?

Answer 1

No, although most remain functioning because of some form of government intervention. It's the "All" part of the question.

Consider two examples, an "indivisibility" and trade secrecy.

Trade secrecy means a non-patented process or invention yielding a unique product that has no effective competition (no close substitutes). Obviously, if a patent is filed for, that's a monopoly protected by the government (via support of litigation in the event of a breach of patent rights). However, if no patent is filed for, but the process remains secret, then monopoly rights exist for so long as the secret remains intact.

The best example of a trade secret monopoly was Zildjian cymbals. Most cymbals sound like a piece of metal being smacked, but the sound of Zildjian is unique, smooth, and precise. It was a family business, and only the owner (Mr. Zildjian) knew the "recipe" for making these wonderful cymbals. Nothing else came close - except when his son, Sabian, broke ties with dad and decided to found his own company (ie, making Sabian cymbals).

An indivisibility is a resource that can only be tapped by one entity. For instance, commercial space travel. Virgin, Inc. is constructing what is (as of now) the world's only passenger spaceflight facility. Sure, any multi-millionaire can buy a ticket on a Russian cosmonaut vehicle, and NASA scientists can launch your satellites and some highly-trained personnel into orbit. But if you just want a relaxing twilight cruise into the ether, such a product will only be offered by Virgin Aerospace. Part of this monopoly stems from the intense capital expenditure (a traditional reason given for protecting most utility companies from competition, given that it is most cost-effective for consumers to purchase from a utility operating a high return-to-scale), and part of it from the fact that the world really only needs at most one commercial passenger space port at this point in time.

If you'd said "Most" instead of "All" I'd agree with you.

Answer 2

I disagree, The markets create monopolies. If you provide a service or product and do it better than anyone else the market(Buyers) will gravitate to you and put your competitors out of business leaving only you selling those goods or services(by definition a monopoly) Now the government can make things harder or easier depending on the current mindset and kind of business.

Answer 3

I don't think the govt creates the monopolies. Once a business is successful it just builds. Once they get to big though the govt actually seems to rule they are a monopoly and orders there break up. Remember when they broke up AT&T so the little guys could get going (sprint).

Answer 4

first of all the government is the biggest monopoly

second...under Teddy Roosevelt the biggest monopolies were busted up.

But what is happening today is that companies..(like the auto industry) can not compete so they get into join ventures or outright mergers and buys outs to compete with the rest of the market.

In the Philippines and other countries like them..there is more freedom to open places of business. U.S government has too many regulations. Try starting a business in the US ..
you will see so much bureaucratic red tape..but countries like the Philippines have a much friendlier environment for the starting entrepreneur (but you do have to greast some palms??its called graft)

Answer 5

I disagree because the government regulates monopolies and allows unions to be formed. It is citizens and big businesses themselves that create monopolies. They try really hard to get around the regulations and soon take over and buy out all their competition.

Answer 6

I disagree. Monopolies are charters granted by the Crown and the Crown is no longer the effective government.

Answer 7

Not really. You can have a monopoly in the black market, and the government certainly does not deliberately cause that.

Answer 8

I agree. Because of our system of patents, it creates a dominant producer or company behind a new product. Also, everyone knows of the governtments support of big business, and it's connection to the fall & scndal of large companiies such as enron.