The principles of economics, with applications to practical problems by Fetter Frank A

Author:Fetter, Frank A[lbert] 1863- [from old catalog]
Language: eng
Format: epub, pdf
Tags: Economics
Publisher: New York, The Century co.
Published: 1904-03-25T05:00:00+00:00

2. Monopolies may, for special purposes, he classified also special as selling and buying, producing and trading, lasting and '=^^^^®^°* temporary, general and local. The terms selling and buying monopoly explain themselves, though the latter conflicts

with the etymology. Under conditions of barter the selling and the buying monopoly would be the same thing in two aspects. A selling monopoly is by far the more common, but a buying monopoly may be connected with it. A large oil-refining corporation that sells most of the product may by various methods succeed in driving out the competitors who would buy the crude oil. It thus becomes practically the only outlet for the oil product, and the owners of the land thus must share their ownership with the buying monopoly by accepting, within certain limits, the price it fixes. The Hudson Bay Company, dealing in furs, had practically this sort of power in North America. Many instances can be found, yet, relatively to the selling monopolies, those of the buying kind are rare. A producing monopoly is one controlling the manufacture or the source of supply of an article; a trading monopoly is one controlling the avenues of commerce between the source and the consumers. Monopolies are lasting or temporary, according to the duration of control. By far the larger number are of the temporary sort, because high prices strongly stimulate efforts to develop other sources of supply. Yet the average profits of a monopoly may be large throughout a succession of periods of high and low prices. Monopolies are general or local, according to the extent of territory where their power is felt. At its maximum where transportation and other costs most effectually shut out competition, monopoly power shades off to zero on the border-line of competitive territory.

3. Degrees of power to affect price result from varying Relativity extent of control; monopoly is a relative term. The term o*™o°op°iy monopoly by its derivation has reference to a single seller;

but there are other thoughts in the concept. Monopoly has reference also to the amount of the supply controlled. The

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