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Monopolies

Monopolies

The corporations of today are much different than the corporations of ten years ago.  Corporate mergers, which occur every month, are creating threatening giants, and companies going to court for years at a time battling over the same issue “are they a monopoly or not”?  IBM merged ten years ago and Microsoft is merging right now.  In order to come to a conclusion on this decade old question, you first must know the facts about what a monopoly is and what it takes to create one.   
What constitutes a monopoly?  One more of the following elements must be present: (1) control of a major resource necessary to produce a product; (2) technological capabilities that allow a single firm to produce at reasonable prices all the output of a particular commodity or service; (3) exclusive control over a patent on a product or on the processes used to produce the product; (4) a government franchise that awards a company the sole right to produce a commodity or service in a given area.  Edwin Mansfield, a political scientists, said, “for a monopoly to be effective there must be no practical substitutes for the product or

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