Discussion Board 8
There are four basic solutions to handling monopolies: 1. Break it up (through anti-trust laws); 2. Regulate it; 3. Take it over; or 4. Leave it alone.
Of these four solutions, which one is superior? Why? If your answer is that "it depends," under what conditions would you favor each possibility?
Also, are there any redeeming qualities of monopolies? What are they?
Interested students can learn more about this topic in Chapter 15.
Post your original thought and then reply to 3 student post and remember make your responses meaningful
Remember there should be a total of 4 posts made by you the student.
STUDENT POST #1
I think that all of them are plausible in different situations. Break it up works best when the company is malicious in their monopoly. Forcing citizens to do something that harms them, or puts them in precarious situations and financially blackmailing them can be awful for people to escape. This can also work to stop 2 giants in an industry from combining like pepsi and coca cola. If the government steps in to relieve them then it is the best option.
Regulate it works best when the good is a need such as water. The Government can come in and make sure it is regulated and fair to both the organization and citizens. Everyone can come out ahead of this without having the organization be extremely greed. On the other hand, taking it over is used in the most desperate situations. If an organization is already being detrimental to the community and larger even the state or the country, then the government needs to take it over. If a company resists the regulation they also need to be taken over. Electricity, postal services, and water are common practices for these.
Finally, the government can just leave it alone. This is the policy that most economists agree is the best. It lets the free market handle itself and lets the demand and supply curve react accordingly. This is probably the most fair one, but I still think for basic human needs, regulation works well.
STUDENT POST #2
A Monopoly is quite a feat in today's business world considering how competitive the market can be. In the case of a company having a Monopoly, the US Government would definitely interfere as time went by as so not to let the business "get out of control." I feel as if the government should stop the monopoly or find a way to divide it or make it fair for others in the market. Another thought that came to mind when reading our prompt for this week was the fact that the government also had the option to take over the Monopoly. If the Government was to take over this company they could potentially use it for a good cause and maybe use the immense profits to go towards the national debt or some other important effort.
STUDENT POST #3
I am for the leave it alone option and letting the market sort itself out. Consumers still can control a monopoly by simply not buying the product as long as it is not a good needed for survival. That is the only case where I think the government needs to get involved. Otherwise it is simple, the company cannot jack the price up too much or consumers simply wont buy it. It doesn't benefit the company to make their good unattainable to consumers. In todays world it is very hard for a monopoly to take place simply due to the number of companies out there and the similarity to most products. There are not very many products out there that don't have a close replacement available, outside of natural resources.
