by Emin on Mon 08 Mar, 2004 21:39
volgens mijn ecoboek, is wel in het engels maar heb geen zin om te vertalen :s als het niet lukt moet je even maar even msn'en:
a pure monopoly exist when there is a sole supplier. in this case the firm will be the industry. (an example is the bank of england which is the only supplier of bank notes in england and wales)
the government definition is a firm which has a 25% or greater share of the market. (for example in 1999 cadbury's controlled 32% of the UK chocolate markets and the sun newspaper 30% of the national daily papers market and 56% of the UK tabloid paper market)
however, market share alone is not always a good guide to monopoly power. a firm supplying a quarter of the total market may have greater market power if the rest of the market is shared by numerous firms. whereas it may face very fierce competition if the rest of the market is supplied by 3 firms of almost equal size.
reference is also often made to natural monopolies. a natural monopoly occurs when there is room for only 1 firm in the industry producing at the minimum efficient scale. the situation can arise when there is just one source of supply of a raw material. however more commonly it occurs when economies of scale are very significant and so permit only one firm to supply the entire market at a lower price than any other number of firms.
a monopoly has the power to determine:
-the price at which s/he will sell the product
-the quantity s/he wishes to sell
(s/he cannot determine both as s/he cannot control demand)
the monopolist power to influence price and to earn supernormal profit depends upon 2 crucial factors:
-the availibility of close substitutes
-the power to restrict the entry of new firms
er zijn "barries to entry or exist a monopoly" maar ik heb geen zin om die allemaal over te typen :s moet je die ook weten?
disadvantages of monopoly:
critics say that monopolists will use their market power to restrict supply and thereby drive price above cost. comsumers may suffer prices being higher and output lower than the allocatively efficient levels.
the lack of competition may also mean that monopolies may not feel the need to seek to lower costs, innovate and improve the quality of the product. market power is likely to lead to supernormal profits, with or without innovation.
monopolies are also accused of delaying technical progress by restricting the entry of new firms (barriers to entry). entrepreneurs with fresh ideas may be excluded from the market.
in addition, under conditions of monopoly, whilst there may be a range of products on offer there will be a lack of, or restricted, choice of producers.
meh!