Notes on Monopoly Capital in the 21 st Century

2007

This paper addresses the concern that monopolies arise naturally out of the free market. An attempt is made to compare and contrast two theories of monopoly economic and political monopoly that this is not true. This paper further demonstrates that the two theories of monopoly have their separate roots in two opposite theories of competition: perfect competition and competition as rivalry. Hence the paper discusses only one of these theories of competition accurately describes the nature of competition in an economy. Besides, the paper also delves the two theories of competition and monopolies are derived from collectivist and individualist political philosophy. It illustrates how perfect competition and economic monopoly have undermined economists' understanding of the actual nature of both competition and monopoly. After investigating these theories, an attempt to made to apply them to show how one can come to very different conclusions about when monopoly power does and does ...

Monopolies make their presence felt in a market economy, not necessarilythrough 100% ownership control of a market, nor less, because there is a law thatsanction its existence; in most cases, the existence of a monopoly and hence its corollary,i.e. monopoly power, has as the primary cause the presence of market imperfections, thatis if those are present on the long term, become state of fact. Thus, in our approach, weconsider that to bet appropriate to release the mechanism of a monopoly, based on amathematical tool, which begins from the immutable economic concepts of monopoly.

Journal of Economic Surveys, 1988

This article presents a survey of theories of monopoly capitalism. The defining characteristic of monopoly capitalism is that developed capitalist economies are seen as essentially dominated by firms which operate in oligopolistic industries. It discusses in chronological order the contributions of Hilferding, Lenin, Kalecki, Steindl, Baran and Sweezy, and Cowling to the monopoly capitalism approach. By drawing out some common features of the authors discussed we arrive at an implicit view of the nature of theories of monopoly capitalism. The macroeconomic aspects of monopoly capitalism are discussed with emphasis on the implications for the level of economic activity. A further section discusses the international aspects of the monopoly capital approach. The final section of the paper reviews criticisms of the theories of monopoly capitalism with concentration on those advanced from a Marxist perspective.

Journal of Economic Surveys, 1987

This paper examines two important recent developments in the theory of natural monopoly, or more generally the theory of market structure. The first is a series of papers, involving Baumol with various co-authors, investigating the theory of industry structure, whilst the second is particularly associated with the names of Shaked and Sutton, and the relationship they develop between product differentiation and industry structure. The paper surveys and to some extent contrasts these two new approaches. Baumol ef al.'s contribution is seen to be in the area of clarifying the concept of qatural monopoly, refining the definitions of multiproduct costs, and developing a notion of social efficiency applicable t o industries where economies of scale are important. Shaked and Sutton employ a new definition of natural monopoly unrelated to market size and utilize information about consumers' income distributions to develop their notion of vertical product differentiation and natural oligopoly.

PANORAMA ECONÓMICO

A production market with given preferences, technology and compe tition technology is vulnerable if it admits both perfect competition and monopoly or oligopoly. Under decreasing returns, sunk costs combined with a potential for monopoly profits provide a sufficient basis for vulnerability. A large agent can establish monopoly by installing enough productive capacity. The monopolist deters entry by threatening to oversupply the market. The threat is credible if the future discount rate is low enough and if enough small players enter the market in the absence of punishment. Financial institutions can capture vulnerable markets for profit, reducing competition, efficiency and equity.

Oligopoly and oligopsony have been studied extensively. However, the dual figure of the oligopsonistic-oligopolistic intermediary has not been. This dual personality has a double negative impact on the market, on the one hand reduces the demand to producers who face a competitive market, lowering prices as buyers, and on the other hand reducing its offer by raising the prices as sellers. In this way, their benefits are increased to buy cheap and sell expensive, affecting effective demand of the consumer and the effective supply of the initial producer. The monopolists, by keeping the market constantly understocked by never fully supplying the effectual demand, sell their commodities much above the natural price, and raise their emoluments, whether they consist in wages or profit, greatly above their natural rate ". Adam Smith The wealth of nations (1776) The monopsonists, by keeping the market constantly overstocked by never fully demanding the effectual supply, buy the commodities much below the natural price, and reduce their expenses greatly below their natural rate.

Asian Economic and Financial Review, 2018

The primary focus of this research is on the genesis of companies as the dominant assumption of their behavior, from perfect to deviant. The phenomenon of extraction of monopoly rents and its extremely negative effects on social welfare, such as rent-seeking, is assumed by the authors to be conditioned by the genesis of companies, and therefore, describes the nature of their activities and survival in the market. The paper attempts to interpret the relationship between the problems of inefficient production in monopoly markets as a necessity and inevitability caused by the genesis of monopoly companies. Furthermore, the paper synthesizes classical economic analysis of profit maximization in monopoly markets and the negative consequences that arise from it, with the Marxist analysis of the genesis of capitalistic companies. Regardless of the type of ownership profit maximization and competition represent a common denominator for both economic directions. The main thesis of the paper is that the free competition is a generator of capital accumulation, concentration and centralization as well as the most powerful tool for the eliminating market competitors. However, the competition battle does not stop with the market monopolization. It continues at higher levels of production and capital concentration, within and outside the limits of domestic market, whilst the goal becomes a tool ? capital to capital, with a tendency for further accumulation of all its negative consequences and connotations. Accordingly, the regulation of imperfect markets is becoming a necessity, thus the dialectical approach to regulation is proposed for various industries through principles and legal solutions for industries which respect specific characteristics of each market and the historical timing of the application of regulation.

“The problem of imperialism is not only a most essential one, but, we may say it is the most essential problem in that realm of economic science which examines the changing forms of capitalism in recent times. Everyone interested not only in economics but in any sphere of present-day social life must acquaint himself with the facts relating to this problem, as presented by the author in such detail on the basis of the latest available data. Needless to say that there can be no concrete historical analysis of war, if that analysis does not have for its basis a full understanding of the nature of imperialism, both from its economic and political aspects. Without this, it is impossible to approach an understanding of the economic and diplomatic situation of the last decades, and without such an understanding, it is ridiculous even to speak of forming a correct view on the war.”

This paper, prepared for an EUI workshop on cartels in 1993, outlines the development of the economic analysis of competitive markets and the way in which economists sought to deal with the problem of oligopoly before 1950

History of Political Economy, 1995

Until recently few competitors matched the authority with which the theory of monopoly capitalism has presented a Marxian analysis of contemporary affairs. Promoted by two influential books-Josef Steindl's Maturity and Stagnation in American Capitalism ([ 19521 1976) and Paul Baran and Paul Sweezy's Monopoly Capital (1966)-for several decades this tradition sustained a singular Marxian presence within U.S. economic thought. More generally, the pointed and topical analyses offered by these works and by Monthly Review, the journal and publishing house associated with the theory, have been influential in countries around the world. The school is known for the argument that the onset of oligopoly in major manufacturing industries produces a tendency toward demand shortfall. Unless stimulated by epoch-transforming innovation (like the automobile) or by other temporary spending spurs, developed capitalist economies are thought structurally prone to prolonged bouts of reduced investment and slowed growth. This view was suggested in general terms as early as Sweezy's Theory of Capitalist Development (1942) and continues to be forcefully propagated today.