In modern life, various types of monopolies are considered. The term "monopoly" refers to such enterprises and organizations, the scale of which covers most of the country's market. They get priority right to set prices for certain types of goods and services, get the opportunity to suppress or join small companies.
It is possible to distinguish specific types of monopolies by grouping them according to a certain classification criterion. For example, depending on the scale of the impact on the country's economy, there can be an absolute and pure monopoly. The latter assumes the presence of a large enterprise that focuses on a particular industry. In this case, the appearance of competitors in the market is almost impossible, and the monopolist fully controls the movement of the manufactured product in the market and the level of prices for it. An absolute monopoly is characterized by state regulation, all processes taking place on the market are in the hands of state bodies that establish the basic principles of activity.
Some types of monopolies can be distinguished based on the criteria of the reasons for their appearance. These include artificial and natural, as well as legal monopolies. The latter have a "talking" name and are formed under the influence of current legislation. Among them, the patent system has become widespread - the assignment to the author of an invention of ownership rights or the issuance of permission to carry out a certain type of activity. The legal monopoly includes the development and registration of a certain trademark, which subsequently becomes known throughout the world and is a kind of guarantee of product quality.
Natural monopolists are those enterprises and organizations that use either rare materials inaccessible to other industrialists or special technologies in their production activities. In our country there are only about five hundred such enterprises among four thousand diverse monopolists. We can distinguish such types of natural monopolies as:
- companies involved in the production process of rare types of metals, special grapes and other elements that are not easy prey for producers;
- firms and organizations that have secured the support of the government, for example, engaged in the production of military equipment, construction of roads and residential complexes.
Natural monopolists have a huge impact on the country's economy, as they lead the process of pricing in the market. Due to the large volume of production, the cost of raw materials is reduced, which allows to reduce its cost. And this creates serious problems for firms engaged in the production of similar goods, but in smaller volumes, because they have to find ways to lower prices in order to maintain their market position.
There are companies that seek to cover a large part of the market, purposefully expand the scale of production and cover a certain area. Such types of monopolies are called artificial and imply the achievement of specific goals and benefits through the implementation of the developed measures. They do everything to conquer a large part of the market and control the activities of competitors. For this purpose, special monopolistic associations are created, the participants of which have privileged rights to enter the market and carry out marketing activities. All other companies do not get this opportunity. Artificial monopolists make every effort to develop their own equipment and technologies, so their products are in great demand and receive only positive feedback from the consumer group.
Having described what a monopoly and its types are, I want to conclude about the role of such large-scale organizations in the country's economy. In this case, one can say about the dual nature of influence, since on the one hand monopolies contribute to the improvement of production activities, and on the other hand, the complete lack of competition in the market negatively affects pricing. In addition, it is extremely difficult for young entrepreneurs to start their own business and occupy their own niche in the market.