Mo but no. Abstract: Monopolization of production and antimonopoly regulation

Monopoly is a state of the economy in which a single entity that determines prices and quantity of a product dominates in a certain business niche. The model is considered the least efficient for the consumer, since the lack of competition causes stagnation and scarcity.

Monopoly is a natural or artificial state of the market, in which the means of production for one or more goods (services) are wholly owned by one player. A state, a private firm, an international organization can act as a monopolist. The exclusive right to extract a resource and process it, supply a product or provide a service can lead to both the protection of consumer rights and their violation.

In economics, the Herfindahl Index is used to assess the real state of affairs in the country and the world. This indicator shows the degree of concentration of a particular market in the hands of its specific players: the conditional value of HHI is calculated as the squared sum of the percentage of revenue from the total "pie" of each participant.

Pure monopoly, 1 participant: HHI = 100 2 =10000

2 players: HHI = 50 2 + 50 2 = 5000

10 players: HHI = 10 2 x 10 = 1000

The emergence and development of monopoly

Monopoly - what is it, what is the danger of the phenomenon? The desire to capture the market and extract maximum profit is natural for business. The first formations of this type arose in antiquity, when the rulers of cities and lands concentrated the production of certain goods in their hands. In Tsarist Russia, only the state (read - its leader) had the right to produce alcoholic beverages. And China had an exclusive technology for creating silks and porcelain - no one could offer analogues.

At the moment, nothing has changed significantly: monopolies are either created artificially or formed naturally. At the same time, excessive concentration of markets in the hands of one participant is recognized as unfair competition. In reality, it is not easy to influence the state of the economy, since impressive funds are required for changes.

Types of monopolies:

Natural. A product or service is produced that has no analogues, and the development of an alternative requires too much one-time investment. This, for example, for a long time concerned rail and air transportation: the means of communication, concentrated in the hands of one owner, they excluded competition.
Artificial. Measures to limit the number of participants are taken at the state level in order to ensure the quality standard of goods (services) and (or) consumer safety. This applies to gas transportation, storage of nuclear waste, etc. The register of such monopolists is presented on the website of the FTS of Russia.
Open. After the invention of a new technology and the launch of its commercial use, the owner of the secret temporarily becomes the exclusive participant in the relationship with the consumer. For example, if the teleport principle is revealed in the near future, transport companies providing this service will be temporarily deprived of competitors.

Oligopoly

Oligopoly is a state of the market in which the right to extract a resource, process it, produce a product or provide a service has a limited number of participants. A classic example is the production of passenger aircraft, spacecraft, where competition is between two or three companies.

Advantages of monopolies:

Implementation of a unified policy. For example, in Saudi Arabia, the concentration of the oil and gas complex in the hands of the state makes it possible to influence world oil prices by solving external problems.
Ensuring high profits. Administrative regulation of prices allows the manufacturer to quickly recoup their costs, to get the most revenue.
Consumer protection. In some cases, state regulation of production provides security to the least well-to-do sections of society.

Criticism of monopoly

Monopoly: what is it in simple terms? This is the desire of a group of people to completely take over the distribution channel, "to sit on the pipe." At all times, opponents of the excessive concentration of markets have argued in favor of the development of competition. The more companies vying for their share of the business pie, the better for the consumer.

15 years ago, when cell phones were produced exclusively by high-tech giants, only the wealthiest consumers could afford to buy them. Years later, offerings from hundreds of small companies have slowly but surely dropped the price of devices, while the level of gadgets has skyrocketed.

The monopolization of industries ensures the reduction of technical progress - the manufacturer has nothing to strive for. This was fully felt by the inhabitants of the USSR, where there were only a few large car factories, and the queues for cars were scheduled for years to come. As a result, Avtovaz produced the same models of vehicles for decades, and world progress moved forward, leaving the entire industry behind.

Thus, one more impartial part of the process is exposed - a severe shortage of goods and services. It can arise artificially or randomly (due to poor calculation) in a way. In the absence of competition, the producer himself decides how many goods he "throws out" for sale. And a glut of demand will mean a decrease in profits for such a giant.

Monopolization of markets in Russia

The list of sectors of the economy in which the concentration of a large share of profits in the hands of one participant is allowed is listed in the Federal Law No. 147 of 08/17/1995 - “On natural ...”. In these areas, strict state regulation is carried out through the establishment of marginal prices. The lack of competition has a negative impact on industries: this can be seen in the example of the Russian Railways Corporation.

All other manifestations of monopoly are pursued by state bodies and are not permissible. Antimonopoly authorities monitor the degree of concentration of markets in the hands of one or another player, collusion between large manufacturers of goods or service providers.

For 6 months of 2016, the antimonopoly services of the Voronezh region alone prosecuted violators on 12 facts of violation of the law (we are talking about the use of the dominant position of housing and communal services, power engineers), the total amount of fines amounted to 180 million rubles.

The main monopoly industries in the Russian Federation:

Central water supply and sanitation (JSC Mosvodokanal, State Unitary Enterprise Vodokanal of St. Petersburg);
Fuel and energy complex (JSC "Gazprom", JSC "Mosgaz" and others);
Railway transportation (JSC Russian Railways);
Airport services (JSC Vnukovo Airport, JSC SIA);
Ports, terminals, inland waterways;
Public postal and telecommunication services (for example, Federal State Unitary Enterprise "Post of Russia", OJSC "Moscow City Telephone Network");
Disposal of radioactive waste (Federal State Unitary Enterprise “National Operator for Radioactive Waste Management”).

Monopoly game

A well-known fun for children and adults will help to experience all the delights of such an economic model. The tactical game, where participants "buy enterprises", upgrade them and charge a fee for passage through their territory, clearly demonstrates the danger of monopolizing the market. The most intelligent, prudent and successful businessman in the end remains in splendid isolation, crushing the entire game board under him.

The market economy, with its mechanisms for regulating free competition and entrepreneurship, has largely contributed to the formation of the picture of the world that we have today. The advantages of this type of system are undeniable, but this was not always the case. Moreover, until now, some sectors of the economy of different countries have a monopolistic basis. This is the only possible option for their effective functioning. So what is a monopoly? What is its essence?

We reveal the concept

A monopoly is a market situation when a large enterprise or their association, engaged in the production and sale of unique products, dominates the industry. Such an economic entity is protected from competition. He is the only representative of the market producing a certain product.

Since the monopoly enterprise is in privileged conditions of existence and is the only source of supply, there is no need to fear for the size of demand. This gives him the opportunity to independently form prices and plan production processes according to qualitative and quantitative characteristics. Thus, monopolization is the capture of the entire market or its larger share by one large company.

In modern legislation, such activity is defined as the abuse by an economic entity of its position against the economy and existing laws.

Characteristic features of a monopolized market

Among them are the following:

There is only one seller.
The product or technology is unique and irreplaceable. Therefore, buyers have no choice.
There are insurmountable barriers to entry into the market of competitors.
The company dictates its price to the market.
Legal. When a monopoly is purposefully created by the state, it is under its total control. And in order to avoid the emergence of competition at the legislative level, a ban on the entry of similar enterprises into a particular industry is announced.
Natural. Barriers to entry of competitors are formed by themselves. For example, public utilities are regulated by the state, and for completely natural reasons, competition is not allowed here.
Economic. This type of barriers in the market is organized by the monopolist itself or they appear due to the political or economic situation in the country.

Types of barriers to entry into a monopolistic market

Reasons for the emergence of monopolies:

There are a number of sectors of the economy that are best managed cost-effectively by a single company or state. Such sectors include: energy supply, gas and water supply, pipeline transport, post office, rail transport, metro, etc. Economies of scale in the absence of competition make a monopoly in these industries financially justified.
Possession of a unique resource or technology. Monopolization is a temporary phenomenon until competitors catch up with the company that has taken the lead.
Reduced demand for the product. A low level of demand also leads to the formation of a natural monopoly, since everyone understands the inexpediency of creating competition due to low demand.
Consolidation of the largest companies in the industry. Firms may voluntarily merge to eliminate competitors. A forced merger or even takeover can also occur, when a more successful company buys a smaller or more profitable competitor.

Classification

Monopolization is a multifaceted complex phenomenon, therefore, there are many types of it, depending on what is taken as a basis. The most common classification criteria are as follows.

According to the form of ownership, the types of monopolies are:

state;
private.

According to the nature and cause of occurrence:

Natural. Due to the limited resources or characteristics of the production of goods, it is more economically profitable and more efficient to create a monopoly.

For example, the management of such natural resources as oil and gas is carried out exclusively by the state.

Artificial. This type of monopoly arises in the case of a merger of companies or in the absence of competitors.
Temporary, when a company is a temporary monopolist as long as it has a unique product or technology and has no competitors. This provision will last until other enterprises begin to produce a similar product.
Legal. allowed by the state. Protected from competition by the legal field.

By the level of state regulation:

indirectly controlled. They are created by business entities and are under the supervision of the state.
Directly adjustable. Monopolies are created and ordered at the will of the state in the public interest.

By territorial character: local, regional, national and transnational.

Types of monopolies - a whole section in economic theory. Due to versatility, there is also a division according to forms. Consider their varieties.

Forms of monopolies

The simplest is a cartel, since economic independence is reserved for each of the participants. The main meaning is reduced to the exchange of information and the conclusion of an agreement on prices and the division of sales markets.

A syndicate is an association of several companies from the same industry, as a result of which each of them retains control over its own production facilities, but commercial activities are carried out by agreement of the parties. As a rule, a common sales department is created to simplify the functioning.

A trust is an association of several companies representing one or more sectors of the economy. There is a merger of production, marketing and financial management. In accordance with the percentage contribution of each of the organizations to the common cause, the distribution of shares, and subsequently profits.

Concern - association of companies from different industries on the basis of diversification. The legal independence of the participants is preserved, while a single financial center is being created. This increases the potential for production development.

A conglomerate is a merger or acquisition of diversified companies for the purpose of unified financial control. Companies can be in completely unrelated industries. The main purpose of this is diversification.

Assessment of the degree of market monopolization

It depends on the predominance of one or another type of relationship in the economy. In order to assess the level of monopolization and competition, the following are distinguished:

Market of pure struggle. This is a situation where many companies operate with a variety of products on a mass production scale. Moreover, there are practically no barriers to the entry of new participants in economic relations.
Monopolistic competition market. There are many sellers in the industry with an interchangeable differentiated product, so there is a risk that if the price is not adequately overstated, the buyer may go to a cheaper competitor. This is the most common type of market structure today. This includes manufacturers of well-known brands of sportswear, cosmetic brands, etc.

Oligopoly. This type of market structure occurs when the number of companies producing similar and interchangeable goods does not exceed five. Barriers to entry are very high. Therefore, there is often, but not always, consistency among competitors. In this case, they can agree to share the sales market among themselves. Examples are companies involved in the production of aircraft, the automotive industry.
Monopoly. In this case, there is no competition, this is the exact opposite of the first type of market device.

Monopolization indicators

One of them is the number of manufacturers producing a particular product, and their division into groups depending on size and specialization. To assess the level of monopolization, one also looks at the volume of market share by manufacturers.

Other indicators:

Determination of what share of the total market volume falls on small, medium and large enterprises.
The Hirschman-Herfindel index as the main monopolization coefficient is expressed as the sum of the squares of the shares of companies as a percentage. The market is not captured when the indicator is below 1800. In this case, the possibility of mergers and acquisitions of companies is allowed. If this ratio is in the range between 1800 and 2500, then there is a certain risk that a large enterprise will capture too much market share, which will allow it to dictate its rules to the remaining competitors and buyers. In this case, the consent of the state is required for the merger of companies. If the index indicator is over 2500, then any enlargement of the enterprise through takeovers or mergers is prohibited.

Positive aspects: there are a number of sectors of the economy where competition is unacceptable. The presence of a monopoly in these areas contributes to the rational allocation of resources and economies due to the factor of mass production and cost reduction. Control over natural resources, high-tech and military developments, utilities, enterprises with a unique direction should absolutely not be given to private hands. The most effective will be the management of one company.

The main negative consequences of monopolization are related to the lack of competition. From this follows a long list of negative factors affecting the development of the country's economy.

Consequence of monopolization

Setting inflated prices.
Inefficient allocation of resources.
Lack of incentives to upgrade production facilities and introduce new technologies.
Decreased production efficiency.
Risk for an efficiently functioning sector of the economy.

Regulation of monopolies

The state tirelessly monitors the state of the market. It strikes a balance between competition and monopolization. Otherwise, excessive growth in the number of dominant companies can worsen the functioning of the entire industry. Like any other component of the economy, the activity of monopolies is under the control of a specialized authority.
Its main goals are:

Price regulation.
Creating and maintaining healthy competition.
Providing economic freedom to all economic subjects of the market.
Formation and maintenance of the unity of the economic space.

Thus, competition and monopolization are two radically different concepts, a counterbalance to each other. However, both have a dual characteristic, which implies that these market structures have both positive and negative sides. Competition is necessary for the progressive development of all sectors of the economy. However, as the practice of most states shows, monopolistic structures are also indispensable.

Monopolization is an economically justified phenomenon in certain market sectors. But without its regulation, a negative impact on the development of the industry is possible. That is why antimonopoly legislation was developed, which allows you to keep the situation under control and maintain a balance between these two types of economic relations.

monopolization- and, well. monopolisation f. Establishment of a monopoly. There is monopolization in this action, but there is no production. Butovsky 1847 2 86. Monopolization of capital. OD 1877 11 2 17. We support the monopolization of the trade in bread. Lenin 27 114. Russian platinum ... Historical Dictionary of Gallicisms of the Russian Language

Concentration Dictionary of Russian synonyms. monopolization noun, number of synonyms: 2 concentration (23) … Synonym dictionary

MONOPOLIZATION, monopolization, pl. no, female (book). Action under ch. monopolize. Explanatory Dictionary of Ushakov. D.N. Ushakov. 1935 1940 ... Explanatory Dictionary of Ushakov

And, pl. no, w. (German Monopolisation, French monopolisation ... Dictionary of foreign words of the Russian language

monopolization- MONOPOLIZATION1, i, g The process of establishing a monopoly, eliminating competition. The process of monopolization is actively going on in the oil industry. MONOPOLIZATION2, i, g Actions aimed at establishing a monopoly of the exclusive right of the state, ... ... Explanatory dictionary of Russian nouns

G. Establishment of a monopoly [monopoly I 1.], elimination of competition; conferring the exclusive right to do something. Explanatory Dictionary of Efremova. T. F. Efremova. 2000... Modern explanatory dictionary of the Russian language Efremova

Monopolize, monopolize, monopolize, monopolize, monopolize, monopolize, monopolize, monopolize, monopolize, monopolize, monopolize, monopolize, monopolize (Source: “Full Accentuated Paradigm… … Word Forms

monopolization- monopolization, and ... Russian spelling dictionary

monopolization- (1 f), R., D., Pr. monopoly / tions ... Spelling Dictionary of the Russian Language

AND; and. to Monopolize and Monopolize. M. trade. M. release of buses ... encyclopedic Dictionary

Books

, Komolov OO. The work is devoted to the study of monopolistic tendencies in the modern economy. The author convincingly proves that monopolization is an objective trend in the development ...
Monopolization as a factor of crisis processes and transformation of the modern market economy. Monograph, Komolov OO. The work is devoted to the study of monopolistic tendencies in the 160; modern economy. The author convincingly proves that monopolization is an objective trend in the development ...

In the economy, there are a fairly large number of different processes that affect its development and course. One of them is monopolization. This phenomenon has both positive and negative features, and must be monitored and regulated in order to avoid significant negative consequences. So what is monopolization, what is its essence and what is its impact?

Concept definition

To understand the question "what is monopolization", it is necessary to understand that the market of perfect competition is characterized by the homogeneity of the goods offered, a large number of producers, freedom of trade and information. This situation is theoretically ideal and is taken as a model, but does not occur in reality. Its complete opposite is the establishment of a monopoly. That is, the market (or its separate direction) is occupied by one or several large companies that set a pricing policy, regulate production volumes, etc. This is the process of monopolization. It covers, as a rule, one branch of the economy. For example, in the countries of the post-Soviet space, almost everywhere there is a monopoly in housing and communal services. The monopolization of the industry in this case is characterized by the fact that only one company provides electricity to the population and enterprises, gas - the second, water - the third, etc. The consumer does not have the opportunity to choose a supplier, there is no price competition, etc.

Negative Facts

The problems of market monopolization follow directly from the definition of the concept itself. These include the following:

Positive sides

What is monopolization in terms of its impact on the economy? It cannot be said that this process has an exclusively negative impact, since there are several arguments in its favor. For example:

Consequences

In the presence of monopolization, there is usually a net loss to society. This is expressed in the fact that producers can almost limitlessly raise prices for goods and services, regardless of changes in costs, and the consumer is forced to purchase them on established conditions. Since the income of the buyer does not increase, the volume of purchased products decreases, which means that the level of productivity of the entire industry also falls. Despite the fact that the monopolist receives unreasonably high profits, the whole society as a whole loses from this process. In addition, the consequences follow from the negative aspects listed above.

How to recognize?

What is monopolization from a practical point of view? In different countries and industries, the value by which the level of competition is determined varies significantly. Theoretically, it is believed that if a third of the industry is occupied by the products of one manufacturer, half by three companies (manufacturers or service providers), and five cover more than 60%, then there is a low level of competition. A market is recognized as monopolized if the total number of enterprises is no more than ten. For calculation, the Harfindel-Hirschman index is usually used, based on the indicators of the total number of firms and their shares in the industry as a percentage. The task of determining the level of monopolization and the degree of competition usually falls on the state, since this process significantly affects the economy and the development of not only a particular industry, but the entire country as a whole, as well as, as a result, the standard of living of the population.

State intervention

The presence and level of monopolization in the country's economy is regulated at the legislative level. Economic measures applied to maintain competition, prevent monopoly and its negative impact include:

Support, financing or provision of benefits to manufacturers of substitute goods, scarce products, etc.
Attraction of investments in monopolized industries, including foreign ones, as well as assistance in their entry into the market
Initiation and funding of research and development activities in order to develop an industry with a low level of competition.

Administrative government measures include:

Control of the creation, merger, acquisition, etc. of manufacturing companies.
Forced demonopolization (separation, crushing).
Penalties, administrative and criminal liability for attempts to monopolize the industry.

The most complex and well-developed system of struggle is considered to be implemented in the United States. However, in recent years, Russia has also come to grips with the issue of market monopolization, including the adoption of the Law on Competition, and the creation of a special committee to work in this direction.

Market monopolization

In this case, the firms that ensure the best use of limited resources do not necessarily become the owners of the market, and then these resources are distributed worse than they could be in a non-monopolized market.

The first experience of organized antitrust activity of the state was laid down by the adoption of antitrust legislation in the USA in 1890 (Sherman Law). Later, similar laws appeared in other countries. Antimonopoly legislation is aimed at maintaining such a structure of production that would allow it to remain competitive.

Monopolization of the Market

Calculations showed that one company should not produce more than 40 percent of a particular type of product. Legislation prohibits any collusion to artificially maintain prices that do not correspond to the real relationship between supply and demand.

What is monopolization and how does it affect the economy?

(Sherman's Law). Later, similar laws appeared in other countries. Antimonopoly legislation is aimed at maintaining such a structure of production that would allow it to remain competitive. Calculations showed that one company should not produce more than 40 percent of a particular type of product. Legislation prohibits any collusion to artificially maintain prices that do not correspond to the real relationship between supply and demand.

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Market monopolization

Absolute monopoly and the economic consequences of market monopolization

Introduction…………………………………………………………………………….3

1. Main features of absolute or pure monopoly. The effectiveness of absolute monopoly…………………………………………………………….6

2.Positive and negative consequences of market monopolization….17

2.1 Positive aspects of the monopolization of the economy……………….17

2.2. Negative factors of monopolization of the economy……………….20

3.Antimonopoly legislation and antimonopoly regulation: world experience and peculiarities in Russia……………………..23 Conclusion………………………………………………………………… ….…..thirty

List of used sources and literature…………………………32

INTRODUCTION

The relevance of research.

The problems of monopolization of economic life, competition in commodity markets today attract close attention not only of specialists, but also of the general population.

In competitive markets, many firms offer substantially homogeneous products, so that each firm has negligible influence on the price it takes for granted. On the contrary, the monopoly has direct competitors, therefore, it affects the market price of the product. While a competitive firm is accepting the price monopoly sets the price products offered to the market.

Special consideration requires the so-called absolute or pure monopolies, the existence of which seriously affects the economy of a state or even an entire region.

In this paper, we will consider the consequences of establishing the power of the firm over the market. Power over the market leads to a change in the ratio of product prices and costs of the firm. A competitive firm takes the price of its output as given and then chooses the quantity supplied so that the price of the output equals its marginal cost. By contrast, the price charged by the monopoly exceeds its marginal cost.

The practice of setting a high price for products by a monopoly is hardly surprising. It may seem that buyers have no choice but to purchase the product at the price that a single supplier will set. Monopolies are not able to achieve any level of income they want, since a high price leads to a decrease in the quantity of goods purchased by buyers. Although the monopoly manages the price of goods, its profits are limited.

By studying the decisions of monopolies on the volume of output and setting prices, the consequences of the existence of monopolies for society as a whole will be considered. Monopoly firms, like competitive firms, pursue the goal of maximizing profits. But the movement towards the same goal entails very different consequences. Selfish buyers and sellers in competitive markets, regardless of their will, are guided by an "invisible hand" to ensure universal economic prosperity. But since the monopoly managed to avoid the control of competition, the result of the market activity in the case of a monopoly often does not correspond to the interests of the whole society.

The government sometimes has the opportunity to improve market performance. The analysis that will be carried out in this work will expand our knowledge of the “visible hand of the state”. In examining the problems that monopolies raise, we will discuss the various ways in which politicians in power respond to them.

The purpose of the work is to establish signs of absolute monopoly and consider the economic consequences of market monopolization

For this reason, the following work was tasks:

1. Consider the concept of monopoly and identify signs of absolute or pure monopoly

2. Identify positive and negative factors of market monopolization

3. Consider state regulation and antimonopoly policy in the world and on the example of Russia.

source the base was made up of documents on antimonopoly policy in the Russian Federation, diagrams and graphs showing the consequences of market monopolization

The degree of study of this topic, despite the large number of sources remains low.

The work used the works of both Russian and foreign authors, conducting a macroeconomic analysis of the monopolization of the market.

1. Main features of absolute or pure monopoly. Efficiency of absolute monopoly.

The market model of perfect competition comes from many premises that are not always implemented in practice. More adequate reality is the market model of imperfect competition.

The essence of the market mechanism of imperfect competition is most fully revealed by the criteria that determine the types of market structures. The most important of them are: the number of firms in the industry; the nature of the products; entry barriers to entry into the industry; degree of control or power over price.

The most serious obstacle that makes it difficult for new firms to enter the market, where the “old-timers” of the industry manage, are entry barriers:

1. The government grants the firm exclusive rights to certain types of activities through the issuance of diplomas, licenses, competitions, attestations.

2. Ownership of non-reproducible and rare resources. Thus, the institution of private property is used by the monopoly as a means of the most effective barrier to potential customers.

4. Scale effect, i.e. advantages of large-scale production, allowing to increase production volumes and reduce costs.

5. Illegal methods of dealing with new potential competitors (anti-advertising, dumping prices, pressure on raw material suppliers, poaching employees, threats from mafia structures, etc.).

The analysis of entry barriers helps to understand why the concentration of the market is so different in different sectors of the economy, as well as the reasons for the deviation from the ideal market model of perfect competition, where many atomized firms operate.

Currently, economic theory distinguishes three varieties of imperfect competition within the framework of imperfect competition:

1. Pure or absolute monopoly (from the Greek "monos" - one, only, "polio" - I sell);

2. Oligopoly (from the Greek "oligos" - few, few);

3. Differentiation of products, due to which there is a lot of competition.

In the first variant (purely monopolistic competition), one producer (seller) or one buyer (in this case, the term “monopsony” is used) is established in any particular market, which gives rise to the absolute power of such a monopolist (monopsonist) over prices.

For example, if in a small town the only “serious” enterprise, say, is a butter and cheese plant, then it may turn out to be a monopolist in the local dairy products market and a monopsonist in the labor market as the largest buyer of labor.

Such a phenomenon of imperfect competition, which almost never occurs in practice, means a complete absence of competition and can be considered as another purely abstract model of the market.

Thus, in production and on the market, the main features of monopoly are: a high concentration of economic activity in the hands of one or more merged firms; dominant, i.e. the predominant position of these firms in the market for specific economic goods; setting monopoly prices (overpriced when selling and/or understated when buying goods) and thereby obtaining excess profits for themselves. The essence of the specific actions of the monopolist is that, by deliberately reducing the number of its sales and thereby creating an artificial shortage in the market, it seeks to increase the price. The monopsonist, on the contrary, reduces purchases from his suppliers (for example, grain, milk, potatoes from the farmer), creates artificial difficulties for them to sell products, thereby forcing them to lower prices.

Considering the circumstances due to which one firm can become the only seller of an economic good on the market, economic theory distinguishes the following types of monopoly: closed, open, natural, organizational, simple.

A closed monopoly is protected from competition by legal restrictions (patents, state licenses, permissions of the copyright institution, etc.). Thus, in most countries, the state has the exclusive right to manufacture medicines, sell weapons, and so on.

Open or casual monopoly. In this case, the firm for some time becomes the sole supplier of some economic good, without any special protection from competition. Firms that first appeared on the market with new products often find themselves in this situation.

A natural monopoly is an industry in which long-run average costs reach a minimum only when one firm serves the entire market. In such an industry, the minimum efficient scale of production is close to (or even exceeds) the amount demanded by the market at any price sufficient to cover the cost of production.

Market monopolization

In such a case, the unbundling of the firm will lead to a loss of efficiency and economies of scale. Closely related to natural monopolies, which are based on economies of scale, are monopolies based on the ownership of unique natural resources.

A simple monopoly is a monopoly that sells its products at the same price to all buyers at any given time.

An organizational (man-made) monopoly is a large inter-industry associations created to maintain a certain price level or share the joint profits. Such associations are created intentionally by concentrating certain economic and managerial activities in someone's hands. At the same time, in order to obtain super profits and strengthen market power, strong companies either suppress their competitors (with the help of dumping or boycott); or carry out the so-called hostile takeover of rivals (buying their shares, sometimes anonymously); or voluntarily unite with each other (more often by mutual exchange of shares) in various unions, so as not to compete, but to jointly own the market in an orderly and profitable way; or create so-called affiliated companies, their branches. Historically, there have been three main forms of monopolistic unions: cartels, syndicates and trusts. The main differences between them are the breadth of agreements between the participants and the "density" of their association. Such a classification of the types of monopolies is very arbitrary. Some firms may belong to more than one type of monopoly at the same time. These include, for example, firms servicing the telephone system, as well as electric and gas companies, which can be classified as both a natural monopoly (because there are economies of scale) and closed (because there are barriers to competition) . Classification of monopolies can be carried out taking into account time intervals. For example, a patent certificate makes a firm a closed monopoly in the short run, but such a monopoly may be open in the long run due to the limited duration of the patent and also because competitors can invent new economic benefits.

2.1. Positive aspects of the monopolization of the economy

The attitude of society and the state to various forms of imperfect competition is always ambivalent due to the contradictory role of monopolies in the country's economy. On the one hand, monopolies can limit output and set higher prices due to their monopoly position in the market, which causes misallocation of resources and increases income inequality. Monopoly, of course, reduces the standard of living of the population due to higher prices. It is far from always that monopoly firms use their full potential to provide scientific and technical progress. The fact is that monopolies do not have sufficient incentives to increase efficiency through scientific and technical progress, since no competition.

On the other hand, there are very strong arguments in favor of monopolies. The products of monopolistic companies are of high quality, which allowed them to gain a dominant position in the market (except, however, "natural monopolies", which do not always rightfully gain access to a particular activity in the market). Monopolization affects the efficiency of production: only a large firm in a protected market has sufficient funds to successfully conduct research and development.

At the same time, one should not exaggerate the role of monopolies in providing scientific research and experimental design developments. Practice shows that many major discoveries in science and technology are carried out by relatively small, so-called venture companies. On this basis, large firms can emerge (a great example is Microsoft, which had 100 employees in the US in 1981, now has 16,400 employees in 49 countries, a market value of about $40 billion, and an annual turnover of $5 billion).

In addition, large-scale production allows you to reduce costs and save resources in general. Thus, the increase in oil prices as a result of the actions of the OPEC countries had an extremely negative impact on costs in many sectors of American industry. Only the use of scientific research results by large companies made it possible to switch to fuel-saving technologies and reduce costs.

It should also not be forgotten that large monopoly associations (especially intersectoral ones, such as a metallurgical plant, the Stinol refrigerator plant that instantly became famous, and a consumer electronics assembly plant) in the event of an economic crisis hold out for the longest time and begin to emerge from the crisis before anyone else, the more thereby curbing the decline in production and unemployment.

Given the dual nature of monopolistic associations, the governments of all countries with a capitalist-oriented economy are trying to some extent to resist monopoly by supporting and encouraging competition.

It may seem that monopoly and competition are completely incompatible with each other. After all, a monopoly can eliminate free competition, and competition undermines someone's dominance in the market.

Monopoly is in a complex contradictory relationship with competition. The very fact that the production and sale of a product is captured by a monopoly group of large entrepreneurs who receive great benefits from this causes intense rivalry - the desire of other businessmen to get the same gain. On the other hand, if an entrepreneur strives to defeat his rivals, then having achieved his goal, he begins to dominate the market. Conclusion: Monopoly breeds competition, and competition breeds monopoly.

In modern conditions, large capitalist associations have not destroyed competition, they exist together with it, this exacerbates rivalry.

There is a significant number of enterprises that are not members of monopolistic associations and are waging a severe confrontation with them. In each country, monopolies are met among the competitors by foreign companies penetrating the domestic market.

Competition (lat. “concurro” - to collide) is the rivalry between participants in the market economy for the best conditions for the production, purchase and sale of goods. Such a clash is inevitable and is generated by objective conditions: the complete economic isolation of each producer, his complete dependence on market conditions, the confrontation with all other commodity owners in the struggle for consumer demand. The market struggle for survival and economic prosperity is the economic law of the commodity economy.

The high prices at which the bulk of the products produced by the monopolies are sold in the monopoly industry make it possible for non-monopolized enterprises to often sell their products at such favorable prices. As a result, rivalry between monopolies and competition between the latter and non-monopolized enterprises lead to some reduction in industry prices.

In the United States, small and medium-sized firms produce about half of the gross national product (GNP), they create more than half of the jobs. Their products are purchased by large monopolies, who prefer not to take risks in the development of new products in science and technology. Thus, monopolies contribute to the development of small enterprises.

2.2. Negative factors of monopolization of the economy

Without the elimination of the monopoly in the sphere of production and circulation, there can be no talk of any market, since monopoly and the market are mutually exclusive things.

Under conditions of pure monopoly, all ongoing market measures are exaggerated, and sometimes they bring results that are absolutely opposite to those expected. So, in the recent past, price liberalization was reduced to a simple price increase, strengthening the position of monopolist enterprises, which, even with a reduction in production volumes, solve their problems at the expense of end consumers. In a monopolized economy, there is no correct competition, self-regulation, and, consequently, no market environment.

Monopolization slows down structural restructuring, since there is no motivation for work, accumulation, expansion, renewal, for the technical reconstruction of production, which ultimately leads to the physical and moral aging of funds and their “eating up”. Monopoly slows down scientific and technological progress, leads to stagnation in all areas of the life of society, to the complete defenselessness of the consumer.1

Losses from imperfect competition can be illustrated graphically (Fig. 2.1) and tabularly (Table 2.1).

Rice. 2. 1. Consequences of market monopolization

Table 2.11

The net loss to society as a result of the monopolization of the market is the loss to the consumer as a result of a reduction in output below the equilibrium.

According to some economists, the loss arising from the monopolistic misallocation of resources in the United States reaches 2% of the country's gross national product.

Thus, monopolies, by setting a price higher than the equilibrium one, set the volume of production below the efficient one, which leads to irretrievable losses of society. The activity of monopolies increases the uneven distribution of income, which can have negative socio-political consequences.

Since the activities of monopolies are anti-social in nature, the protection of free competition and the restriction of the activities of monopolies is one of the most important functions of the state.

3. Antimonopoly legislation and antimonopoly regulation: world experience and features in Russia

Antimonopoly regulation (regulation in the field of competition) is understood as the purposeful activity of state authorities to weaken market power, limit it, prevent its acquisition and abuse by economic entities, which is implemented through a system of appropriate economic, administrative and legislative measures. The basis of antimonopoly regulation is antimonopoly legislation - a set of laws and legal norms that establish the rights, obligations and responsibilities of economic entities arising in connection with their activities regarding the weakening of competition and the abuse of market power.

The main directions of antimonopoly regulation are determined by the antimonopoly policy, the directions of which include: limiting the monopolization of the market; control of mergers and acquisitions, price discrimination and other methods of unfair competition; protection of consumer rights; protection and support for small and medium-sized businesses.

Antitrust regulation first emerged in the United States in the late 19th century with a series of federal laws called antitrust laws. Currently, it is aimed primarily at preventing monopolization, that is, actions that are illegal in nature and actions whose legality is determined by the rule of reason. In the first case, the existence of the fact of illegal actions or agreements that undermine competition is sufficient for the firm's guilt to be proven. These include: horizontal price fixing; horizontal collusion about market share; agreed refusal to trade; agreement on mutual sales and purchases; related sales (in the assortment set by the supplier). In the second case, according to the rule of reason, all actions and agreements that can have an anticompetitive impact must be subjected to careful analysis, on the basis of which a decision is made.

Fundamentals of antitrust law in the United States

Sherman Act (1890). Prohibits contracts and associations in the form of a trust (or in any other form) that restrict trade, secret monopolization of trade or industry, sole control in a particular industry, price fixing.

Clayton Act (1914). Prohibits and prevents restrictive marketing practices, price discrimination (when this is not dictated by the specifics of current competition), horizontal mergers through partial or complete acquisition of the share capital of a competitor company, leading to restriction of competition, etc.

Federal Trade Commission Act (1914). It is aimed at preventing and suppressing unfair methods of competition and establishing control over the commercial ethics of companies. The Federal Trade Commission has the power to issue regulations and trade regulations, prohibition orders, monitor the activities of a company and, if necessary, investigate its actions.

Robinson-Patman Act (1936). Prohibits restrictive business practices in the field of pricing policy in trade: “price scissors”, price discrimination, etc.1

Wheeler-Lee Amendment to the Federal Trade Commission Act (1938). Expanded the rights of the Federal Trade Commission against companies that harm not only competitors, but also consumers and society as a whole, as well as false or misleading advertising and misrepresentation of product quality.

The Celler-Kefauver Amendment to the Clayton Act (1950). Clarifies the concept of an illegal merger, prohibits mergers through the purchase of assets, in contrast to the Clayton Act, limits horizontal mergers through the acquisition of non-equity capital of the company and vertical mergers leading to restriction of competition.

Hart-Scott-Rodino Act (1976). Strengthens requirements to prevent mergers aimed at creating monopolies or weakening competition, expanding the powers of agencies to enforce antitrust laws.

Tannay Act and Decree of Consent (1995). Adopted in connection with the activities of Microsoft and require that a court determine whether the agreement is in the public interest before any agreement is entered into between the companies. Tighten control over relations between corporations and the Government, over corruption, lobbying by corporations of their interests to the detriment of the public. The court's role is to scrutinize not only the Government's expert opinion on antitrust violations, but also its impartiality.

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