Meaning: -The term “MONOPOLY” is derived from two Greek words “Mono” which
means “Single” and “Poly” which means “Sellers”. Thus Monopoly refers to “market structure in which asingle seller
controls the entire market”. And therefore the seller is a price maker
and not the price taker.
TYPES
OF MONOPOLY
1.
Pure, perfect or Absolute
Monopoly: - A pure or perfect monopoly means
that the firm controls the supply of a product for which there is not even a
remote (close) substitute. Such a monopoly is very rare.
2.
Natural Monopoly: -The monopoly power is acquired due to natural advantages such as
good location, control over scarce resources, involvement of huge investment,
etc.
3.
Legal monopoly: - It arises due to legal protection given to the producer in the
form of patents, trade marks, copyrights, etc. The law prevents the potential
competitors form producing identical
products.
4.
Technological
monopoly: -Big firms enjoy technological
monopoly due to their superior technology and economies of scale. Other firms
do not have the access to such technology cannot produce the quality goods
produced by big firms.
5.
Simple monopoly: -In a simple monopoly the firm has monopoly power over a
product or service, but it charges a uniform price to all the buyers.
6.
Discriminating monopoly: -In a discriminating monopoly, the firm charges different
prices to different buyers in the same market or in different markets fir the
same product.
7.
Private monopoly: -When an individual or a private firm controls the production it
is regarded as private monopoly.
8.
State or Social
Monopoly: -When the
government owns and controls the production of a good or services it is called
state or social monopoly.
