A situation in which a single company owns all or nearly all of the market for a given type of product or service. This would happen in the case that there is a barrier to entry into the industry that allows the single company to operate without competition (for example, vast economies of scale, barriers to entry, or governmental regulation). In such an industry structure, the producer will often produce a volume that is less than the amount which would maximize social welfare.

Use monopoly in a sentence

John Rockefeller had one of the most well-known oil monopolies in U.S. history, but in 1911 the Supreme Court ruled that Standard Oil was an illegal monopoly as it drastically undercut competitors and was forced to be dissolved into many smaller companies.

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