Do Pure Monopolies Exist
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Do Pure Monopolies Exist? An Examination of Remote Area Businesses
ECO 100: Survey of Contemporary Economic Issues
June 3, 2013
Do Pure Monopolies Exist? An Examination of Remote Area Businesses
With a thought in question; how many single businesses within the vast communities in which we live are sole providers of a single product offering no close substitutes while controlling price and facing no competition? Although it is hard to fathom, in some communities, pure monopolies do exist and in a significant manner. While pure monopolies are not so prominent in large communities or metropolises, they are present in small, remote communities where businesses are scarce requiring small populations to rely on what these businesses have to offer. Within the course of this essay, I will not only explain just how pure monopolies exist, but will provide relevant examples in proving my understanding pertaining to monopolies and how they work.
First and foremost, a pure monopoly is regarded as “an industry in which one firm is the sole producer or seller of a product or service for which there are no close substitutes” (Brue, & McConnell, 2010, p. 217). Although pure monopolies are rare and infrequent, they do exist just as well as near monopolies or monopolies "in which a single firm has the bulk of sales in a specific market" (Brue, & McConnell, 2010, p. 217), both being based on de facto industry standards. Examples of a pure monopolies are usually in the form of public utilities to include water, sewer, electric, gas, and local telephone companies (Brue, & McConnell, 2010) while near monopolies may entail “a single gas station in an isolated rural town” (McGowan, 1999, p. 1) or computer firms that produce the majority of micro-processors used in our computers.
Residing in such a small, remote community in Southwestern Arizona, I not only experience pure monopoly, but near monopolies as well. I work within the utility...
ECO 100: Survey of Contemporary Economic Issues
June 3, 2013
Do Pure Monopolies Exist? An Examination of Remote Area Businesses
With a thought in question; how many single businesses within the vast communities in which we live are sole providers of a single product offering no close substitutes while controlling price and facing no competition? Although it is hard to fathom, in some communities, pure monopolies do exist and in a significant manner. While pure monopolies are not so prominent in large communities or metropolises, they are present in small, remote communities where businesses are scarce requiring small populations to rely on what these businesses have to offer. Within the course of this essay, I will not only explain just how pure monopolies exist, but will provide relevant examples in proving my understanding pertaining to monopolies and how they work.
First and foremost, a pure monopoly is regarded as “an industry in which one firm is the sole producer or seller of a product or service for which there are no close substitutes” (Brue, & McConnell, 2010, p. 217). Although pure monopolies are rare and infrequent, they do exist just as well as near monopolies or monopolies "in which a single firm has the bulk of sales in a specific market" (Brue, & McConnell, 2010, p. 217), both being based on de facto industry standards. Examples of a pure monopolies are usually in the form of public utilities to include water, sewer, electric, gas, and local telephone companies (Brue, & McConnell, 2010) while near monopolies may entail “a single gas station in an isolated rural town” (McGowan, 1999, p. 1) or computer firms that produce the majority of micro-processors used in our computers.
Residing in such a small, remote community in Southwestern Arizona, I not only experience pure monopoly, but near monopolies as well. I work within the utility...