Economics of Monopoly

The Economics of Monopoly is the working title of a book I am writing. It all started as an observation on the irony of the EU calling Microsoft a monopoly right after Munich decided to replace its Windows desktop computers with Linux. John T. Kennedy and Patri Friedman made observations about natural and not so natural monopolies that deserve a reply. Unfortunately, as I started writing the reply it turned into something more than a blog entry, and right past full length article into the realm of being a book. Of course, as can be seen by my constant (cough) posting to this blog, I just do not have time to write a book in any reasonable time period. The problem is that theories of monopoly practices cover a large amount of territory - vertical and horizontal monopolies, network externalities, government grants of privilege, commodity goods, differentiable and unique goods and services, barriers to entry, natural and unnatural monopoly, and all the problems of building and maintaining a monopoly. Not to mention that one would be remiss to not delve into the histories of the Carnegie companies, Rockefeller's Standard Oil, Aluminum Company of America (ALCOA), IBM, and Microsoft.

The natural rights argument about monopoly is much simpler - by what right can you demand someone produce a good or service on your own terms?

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Dave, can I preorder a copy?

Dave, can I preorder a copy?

I look forward to your book.

I look forward to your book. I work in antitrust policy, and it's a nonstop source of amusement and anger.

The biggest issue I deal with is the FTC's war on physicians. When doctors get together to negotiate higher prices with managed care organizations, they are prosecuted by the FTC for "price-fixing." The objective is to ensure managed care firms can obtain physician services at prices they demand. The market just gets in the way.

To be fair, Skip, the

To be fair, Skip, the physicians do have a government enforced monopoly on caring for patients in many ways. It being illegal to go into medical practice without a license ;)