Monopolies In A Capitalist Economy :: essays research papers fc

In a capitalistic economy in that location are both wanted and unwanted monopolies. However, in a capitalist economy certain monopolies are needed. Monopolies have a big fix on the economy and the consumers because of the amount of control that the monopolies have on the economy. thither are certain times when it is best to have monopolies then others, it really depends on the status of the economy. There is no doubt that monopolies do indeed play a critical role in a capitalist economy, precisely sometimes there are negative effects.It is indeed genuine to say that not all monopolies are unwanted in a capitalist society. An extype Ale of a monopoly that is not unwanted is that of a earthly concern utility, like SDG& adenosine monophosphateE (San Diego Gas & Electric). These produce goods and function that are vital to the publics well being as far as functioning goes. Public utilities are an example of a pure or natural monopoly. A pure or natural monopoly is a item-by- item firm in an industry. This is the most effective way to provide rattling important goods and services. An example of a public utility monopoly that affects our everyday behavior is that of SDG&E. They are the only power company in San Diego County and therefore they have a monopoly on San Diego. This, however is the kind of monopoly that the government likes to admit running and in operation because they know that we cannot do without for very long. If SDG&E decided to go out of business there would be no power supplier for all of San Diego County. In addition, because of the fact that SDG&E is the only gas and electric provider they can heel almost any price and we have no choice but to comply with their demands unless they can find a dependable alternative, like solar power.The impact of monopolies is felt very heavily on the consumer. The biggest effect of a monopoly in a food market is that it mothers up the prices of the product in that market (South West, p g. 179). This happens because there is no competition and no other producer to drive prices down. The government has often tried to break up monopolies when they are presented because it ordain put a negative impact on the economy. There has notwithstanding been legislation passed against monopolies. An example of a piece of legislation is the Sherman Anti-Trust Act which tell "any combination or conspiracy in constraint of tack" (www.