Monopoly: Difference between revisions

In an unregulated market, monopolies can potentially be ended by new competition, breakaway businesses, or consumers seeking alternatives. In a regulated market, a government will often either regulate the monopoly, convert it into a publicly owned monopoly environment, or forcibly fragment it (see [[Antitrust]] law and trust busting). [[Public utility|Public utilities]], often being naturally efficient with only one operator and therefore less susceptible to efficient breakup, are often strongly regulated or publicly owned. [[American Telephone & Telegraph]] (AT&T) and [[Standard Oil]] are often cited as examples of the breakup of a private monopoly by government. The [[Bell System]], later AT&T, was protected from competition first by the [[Kingsbury Commitment]], and later by a series of agreements between AT&T and the Federal Government. In 1984, decades after having been granted monopoly power by force of law, AT&T was broken up into various components, [[MCI Communications|MCI]], [[Sprint Corporation|Sprint]], who were able to compete effectively in the long-distance phone market. These breakups are due to the presence of deadweight loss and inefficiency in a monopolistic market, causing the Government to intervene on behalf of consumers and society in order to incite competition. {{citation needed|date=June 2012}} While the sentiment among regulators and judges has generally recommendedbeen thatagainst breakups are not as remedies for antitrust enforcement, recent scholarship has found that this hostility to breakups by administrators is largely unwarranted. <ref name="Van Loo">{{Cite journal|last=Van Loo|first=Rory|date=2020-01-01|title=In Defense of Breakups: Administering a "Radical" Remedy|url=https://scholarship.law.bu.edu/faculty_scholarship/954|journal=Cornell Law Review|volume=105 |issue=7 |page=1955 }}</ref>'''{{rp|1}}''' In fact, some scholars have argued that breakups, even if incorrectly targeted, could arguably still encourage collaboration, innovation, and efficiency. <ref name="Van Loo" />'''{{rp|49}}'''