What are the benefits for the consumer of a monopoly market?

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There really aren't any, except in certain rare circumstances.Monopolies are great for business owners; monopolies restrict production and raise prices, leading to much higher profits. But both of those things are extremely bad for consumers, and in fact it turns out that the harm to consumers is almost...

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There really aren't any, except in certain rare circumstances.

Monopolies are great for business owners; monopolies restrict production and raise prices, leading to much higher profits. But both of those things are extremely bad for consumers, and in fact it turns out that the harm to consumers is almost always larger than the benefit to business owners, to the point where we could literally just take some money from consumers and hand it to business owners, then establish a competitive market, and everyone would be better off than they were under the monopoly. (Not that we necessarily should, but we could, in theory.)

Competitive markets are provably optimal for consumers in the long run, as they produce the most efficient amount of goods and sell them at the most efficient price.

There are basically only two circumstances where monopolies can be beneficial for consumers.

The first is if there is an economy of scale. If the good is actually produced more efficiently in larger quantities, then a natural monopoly will form on its own and is actually more efficient than a competitive market. It's still not optimally efficient, however, unless the monopoly can use price discrimination or is regulated so that they charge the optimal price.

The second is if there are very high setup costs. If production of a good is relatively cheap once you get set up, but costs a huge amount to get started, a competitive market will undersupply that good because there's no incentive to enter the market in the first place. Electricity production and software development are good examples of this sort of industry; laying power lines and writing code are expensive, while running power lines and downloading code are cheap. A monopoly can use the excess profits it gets from overcharging customers later as an incentive to offset the setup costs it had to bear earlier, and thereby be more efficient than a competitive market. We actually intentionally implemented regulatory monopolies in these industries (the former as a public utility, the latter via software patents). But even then a monopoly is not optimal, because there's no direct connection between the size of the monopoly profits and the size of the setup cost. There's nothing to stop a company from making ludicrously huge profits over and above their actual setup costs---and when you look at a company like Apple or Microsoft, it's hard to argue that this isn't what happened. A much better method would be to use tax credits or subsidies to offset the setup costs directly, and thereby entice competitive firms into the market. We could use taxpayer funds to lay power lines and issue software development grants, for example.

In general I guess some degree of monopolistic competition can be good for consumers, as it allows them to use branding to assess the quality of goods; but really that's putting the cart before the horse, because the reason those brands emerged in the first place was precisely that it was hard to assess the quality of goods. Make it easier to assess quality, and the market would become less monopolistic---and therefore better for consumers.

To recap, there are a few circumstances where a monopoly can be better than a competitive market, but these are fairly rare; and even in those circumstances, monopoly is not actually the best system, just better than competition without any other constraints.

So, what are the benefits of monopoly to consumers? There really aren't any.

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In a monopoly market, only one company will be the seller of a commodity. While there may be some disadvantages of that situation, there can also be some benefits to the consumer. Given the monopoly, the company will have no competition and hence will be able to keep prices more or less at steady levels. In a competitive market, prices fluctuate depending on the competition, unlike in a monopoly. More importantly, given the profits earned by a company in monopoly market, much more capital can be invested in research and development, thus resulting in better products and services. The company will also be able to achieve economics of scale and hence (hopefully) will pass on the savings to the consumers and keep costs low. Also, the company will not have to resort to unfair and ugly advertising to claim consumers from the competitors and will not need to make unfair claims. 

Hope this helps. 

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