The term "monopoly" means the dominance in the market of a sole seller or producer of products. Such a business entity represents a whole industry, independently determines both the market price of its goods and its delivery volumes to customers. Monopolies are a product of the development of capitalist relations. Moreover, their very existence is a factor that impedes the implementation of any economic reforms by the state.
Various types of monopolies in Russia do not give full development to market relations. And this is a serious task, the solution of which the relevant state bodies are trying to find.
Historical reference
At the end of the 19th century. centuries-old market development has undergone significant changes. And they were associated with a real threat to the development of competition. However, a significant obstacle arose in the way of such a necessary market attribute, which was the various organizational forms of monopolies.
The history of such economic formations began in ancient times. Various forms of monopolies and their evolution accompanied almost all stages of the development of market relations. However, their recent history began only in the last third of the 19th century, especially manifested during the crisis of 1873.
A sign of monopolistic education
What is this phenomenon? For example, the forms of industrial monopolies are nothing more than separate enterprises and their associations, as well as business partnerships that produce significant volumes of certain products. This state of affairs allows organizations to take a dominant position in the consumer market and set high prices that bring the greatest benefits.
That is why the main sign of a monopoly is its exceptional position. Enterprises included in such formations significantly limit the competition that arises in the market for a particular product. Of course, a monopoly is welcome for every producer. Indeed, in this case, a certain economic power will be concentrated in his hands, which will help to avoid many problems and risks.
Natural monopoly
The dominant position in the market is classified by various types. There is such a monopoly as natural, as well as administrative and economic. Consider the first of them.
The emergence of natural monopoly contributes to a number of objective reasons. Moreover, such a formation reflects such a situation in the market when the demand for a particular product can be satisfied by one company or, in extreme cases, several. The basis of such a monopoly is the peculiarity of production or the uniqueness of customer service. In such cases, competition is simply impossible or highly undesirable. Such organizations provide energy supply, provide telephone services, etc. Either one or a limited number of companies operate in such industries.
Administrative monopoly
Sometimes this or that organization begins to occupy a dominant position in the market due to certain actions of state bodies. Such a monopoly is administrative. A prerequisite for its occurrence is the provision by the state of exclusive rights to perform a certain type of activity. Moreover, such structures, as a rule, consist of state-owned enterprises subordinate to various associations, ministries and central authorities.
The administrative monopoly includes a whole group of business entities of the same industry, acting on the market as a whole. Similar formations were dominant in the former USSR.
Economic monopoly
This form of education is the most common. It appears in connection with the emergence of certain economic reasons and is built according to the laws of economic development.
So, we can talk about economic monopoly in cases where entrepreneurs gain a dominant position in the market in two ways:
- concentration of capital with a constant increase in the scale of the enterprise;
- centralization of capital with the acquisition or takeover of bankrupt firms.
Following the first or second path, the enterprise reaches such dimensions that allow it to dominate the market.
International monopoly
Such education belongs to a special kind. It arises with a high degree of socialization of capitalist production and the development of processes of interpolation of economic life.
What types of monopolies can be attributed to the international type? The first one is transnational. Such a monopoly is national in its constituent capital and control over it, but at the same time it is international in its field of activity. Such forms of capitalist monopolies as concerns are a vivid confirmation of this. For instance:
- Concern Standard Oil of New Jersey. This is an American oil company, whose enterprises are located in more than forty countries of the world. Moreover, the concern placed 56% of its assets abroad, carrying out 68% of sales there, receiving 52% of profit.
- Swiss food concern "Nestle". The bulk of its production facilities and sales organizations are in other countries. In Switzerland, only a small share of the turnover of goods is carried out (2-3%).
International monopolies are also singled out. All concerns and trusts that can be characterized by this term have a number of features.
Their differences, first of all, consist in the fact that their share capital is internationally dispersed. The main core of employees is people of different nationalities. An example of such a union is:
- Anglo-Dutch concern Unilever, operating in the chemical and food industry;
- Belgian-German trust "Agfa-Gevert", producing photochemical products.
The number of such monopolistic organizations is small, which is explained by the difficulties of combining capital that is different in their national origin - these are differences in legislation, double taxation, and opposition from government officials, and much more.
Forms of Monopolies
There is a certain classification of organizations that occupy a dominant position in the market. This list includes a number of basic forms into which monopolistic enterprises can unite. The simplest of them arose in the sphere of circulation. Among them:
- A cartel is a form of monopoly, combining several enterprises operating in one production area. The participants in such a system have commercial independence, retain ownership of the means and implements of labor, and also independently dispose of their product. Cartel participants only agree on the size of their share in the total volume of production, on sales markets and prices for goods.
- A syndicate is a form of monopoly, which is an association of some enterprises within one industry that retain ownership of the means of production, but do not have commercial independence due to the lack of the right to sell their goods. In this case, the sales office is engaged in a general sales office.
There is a more complex form of monopoly. Such enterprises cover the direct manufacturing sector. One of the main forms of monopolies of this type is a trust. Such an association includes enterprises of either one or several industries at once. The participants in the trust have neither ownership of the means of production nor the product they produce. They also lack commercial independence. In other words, in trusts there is a union of production, marketing, finance and management. The advantage of such a combination is that each of its participants has its own share of shares, proportional to the share of invested capital. Such a package gives the right to participate in the management of the trust and receive from it its part of the profit.
There is another complex form of monopoly - a diversified concern. It combines dozens and even hundreds of enterprises belonging to various industries, trade and transport. The participants in such a monopoly lose their right to the ownership of production assets, as well as to the product they produce. In addition, all enterprises are subject to financial control by the parent company.
The emergence of monopolies in Russia
Education, consisting of organizations dominating the market, arose in our country. And for the first time they spoke about monopolies in Russia at the end of the 19th century. These communities developed in a peculiar way, which was distinguished by direct intervention of state bodies in their affairs. The government exercised its influence on the development of organizations in the metallurgical sphere, machine building, transport, and the sugar and oil industries. That is why the types of monopoly in Russia, as a rule, were limited to the administrative type. However, before the beginning of the 20th century. the role of such organizations in the country's economy was insignificant.
The transition of Russia to imperialism
In the years 1900-1903. the global economic crisis erupted. It became the main impetus that led to the accelerated and massive formation of monopolies in Russia. To determine ways out of the crisis, industrialists began to gather at industry congresses. And at the same time, a basic recipe for solving the problem was developed. It consisted in the creation of united trade organizations selling manufactured goods. Thus, lower forms of monopoly appeared in Russia, which are syndicates. These organizations controlled market prices.
Syndicates, as the first forms of monopoly, arose in Russia because of the protective state duties that protected the domestic market. The appearance of such entities was also facilitated by government orders, when the state organized competitions, giving preference to the company that set the lowest price.
Thus, at the beginning of the 20th century. syndicates such as Prodamet, Prodvagon, Produgol, and Roofing arose.
In parallel with the syndicates, such a form of monopoly as a trust began to form. Gradually, “higher type” formations appeared, that is, concerns. Similar associations were developed in the cotton industry. Moreover, entrepreneurs, having accumulated large amounts, first owned banks, and then began to invest their available funds in underdeveloped industries. At that time, they were such industries as automotive, electrical and chemical.
International types of monopolies in Russia operated in the oil industry. They came to our country in the form of trusts that divided world markets among themselves. In Russia there were immediately three representatives of such a monopoly. Among them:
- Royal Dal Shell is an Anglo-Dutch trust.
- "Nobel Partnership", the main capital of which belonged to German industrialists.
- Russian General Petroleum Corporation, created on the basis of Anglo-French monetary investments.
In general, the monopolists brought obvious damage to the country's economy. They kept high prices for their products, sometimes limiting the extraction of fuel and energy resources. That is why the Russian government was forced to deal with such a phenomenon as monopoly. They tried to limit the types and forms of such education to various legislative acts. However, everything was in vain, since most government officials, along with government work, held high-paying posts in various companies.
Industrial decline
Some local monopolies of Russia ceased their activities in connection with the outbreak of the First World War. But in general, during the period of hostilities, the number of such formations only increased. Some concerns, as the highest form of monopoly, have become even more powerful. Moreover, many of them significantly increased their capital, releasing military products.
After the October Revolution, banks and industry were nationalized. As a result of this process, monopolies in Russia were liquidated. The emergence of such entities began again after the 90s, when the country began to move to market relations.
Modern stage
To date, there are no pure monopolies in Russia. There are only certain enterprises whose products occupy a significant market share (65 percent or more). The main form of monopoly in Russia is large associations. Moreover, they all belong to the form of natural formations. Such monopolies were created by the state itself when pursuing a policy of specialization, deepening and concentration of production. However, economic crises have clearly shown that such structures are extremely volatile.
In addition, in Russia there is such a kind of monopolism as local. It arises as a result of market unsaturation, when individual enterprises, against their will, begin to occupy a dominant position. This list often includes organizations involved in the processing of agricultural products, as well as trade, medical and consumer services.
The largest monopolists in Russia are only three:
- RAO "UES", engaged in the production of electricity and providing services for its delivery to the consumer.
- Gazprom, transporting gas through pipelines and selling it to the public.
- MPS heading rail transportation.
Rostelecom can also be included in this list. This organization provides international and long distance communication services. The smaller monopolists organizing their activities in cities are the enterprises of Vodokanal, the Metro, etc. All of them are able to regulate the price of their goods, limiting their supply to the consumer.
Sometimes monopolists abuse the power in their hands. They set too high prices, covering this with their unjustified costs. In addition, in the Russian economy there is a discriminatory attitude on the part of monopolies towards its competitors. An example of this is the decision of the administration of the Kirov region, which created a state-owned enterprise, which included previously independently operating pharmacies, a pharmaceutical factory, a pharmacy base and a control and analytical laboratory. Such an association ceased its activity by decision of the state Antimonopoly Committee.