An overview of monopolies, when one company controls an entire market

Monopolies are considered the most extreme form of imperfect competition

True monopolistic companies face no competition, meaning there aren't any near substitutes for the goods or services the company provides. Often, no competition exists because the monopoly is either approved by the government or the barrier to entry is costly.

Market concentration and high markups don't always signal a monopoly

When regulators and economists evaluate whether a company constitutes an illegal monopoly, they often consider its overall market share or its relatively high price markups. This piece argues that the Olley-Pakes decomposition is a better measure, identifying whether customers within a market are switching to more productive companies.

A 'bilateral monopoly' occurs when there's one supplier and one buyer in a market

Bilateral monopolies are often used to conceptualize labor markets in small towns. Using this concept, large employers have a monopoly over the labor market, while workers have a monopsony as the only available laborers.

An oligopoly is a market structure where a few large businesses dominate the entire market

When a few large companies dominate a market, changes in pricing for goods and services affect the entire market. Airlines are a common example of an oligopoly. Because the barrier to entry in the aviation industry is high, only a few airline companies offer the majority of the industry's services. While there is some competition, pricing across the board is largely intertwined and based on other companies' prices.

A 'monopsony' is a market with a single buyer—rather than a single supplier

A monopsony is the demand-side equivalent of a monopoly, where a single buyer commands a market. In a monopsony, the buyer has an outsized influence over the price of a product or service because they control most or all of the sales in that market.

Read the Federal Trade Commission's legal definition of a monopoly

The Federal Trade Commission and the US Department of Justice (DOJ) Antitrust Division are the regulatory agencies responsible for overseeing antitrust laws. Before deeming any company a monopoly or acknowledging monopolistic power in a market, the FTC conducts thorough research into market competition, price, and even other competitors' business practices.

Watch how American monopolies used vertical and horizontal integration strategies to command markets

Vertical integration occurs when a company controls the entire manufacturing or development process, whereas horizontal integration involves expanding a company's market share. Both strategies have been used by US monopolies to establish dominance in markets.

Explore a list of well-known monopolies

Many American monopolies popped up during the rapid industrial growth of the Gilded Age. Industries like steel, tobacco, railroads, and telecommunication have all been monopolized at some point in history.

Robber barons, the monopolistic business people of the 19th century, explained

“Robber baron” was a term used to describe 19th-century businesspeople who engaged in monopolistic business practices and didn’t face much business regulation, resulting in significant wealth.

Utility companies are often considered 'natural' monopolies

Natural monopolies occur in industries where the upfront costs of entering the market are high, making competition unrealistic. Investor-owned power companies, like Duke Energy, often have natural monopolies, as building alternative power grids and transmission lines is too expensive and impractical for competitors.

Patents arguably grant inventors monopolies for a short period of time

As a way to reward innovation, the government grants short-term monopolies on patented products. Patents block other companies from producing or selling that product, giving inventors the rights and opportunity to establish themselves in a market before other competitors enter.

Network effects are the economic term for a good or service's popularity

When goods or services become especially popular, firms that provide that good or service become dominant in the market—which can ultimately lead to a monopoly.

Nvidia controls more than four-fifths of the GPU market—but isn't considered a monopoly

Semiconductor company Nvidia has a commanding market share when it comes to graphics processing units. Its competitors include Advanced Micro Devices and Intel, which together account for less than a fifth of the GPU market.

A centrally planned economy is one where the government—not markets—sets production

This Investopedia article explains how command economies work, which countries have used them, and why even market-based nations like the US sometimes adopt tools such as rationing or price controls during wartime or national emergencies.

Learn more about the four main market structures

In modern economic theory, there are four main market structures. Under each market structure, firms (or businesses) have differing levels of competition and reach different levels of price efficiency based on the consumer's willingness to pay for a product or service.

Legendary venture capitalist Peter Thiel once wrote that 'competition is for losers'

With Peter Thiel's "Monopoly Theory," the Founders Fund partner argued that investing in companies that create new categories, rather than those that compete with other businesses in existing ones, is a best practice in venture capital.

'Genericide:' Learn how too much brand awareness can hurt a company's trademark

When a brand becomes so popular that consumers regularly call the product by the brand name like a noun or verb, that trademark becomes generic because consumers no longer associate a specific brand with a certain product. A generic product can hurt a company's right to trademark or even cause companies to lose it. (Some users may experience a paywall.)

Tech giants like SpaceX and Meta are increasingly behaving like sovereign powers

Companies now make unilateral decisions once reserved for nation-states, such as controlling satellite internet access in active war zones and influencing global information flows. Lawmakers and the international order are struggling to keep up with technological developments, let alone regulate them.

A breakdown of net neutrality, including its benefits and disadvantages

The principle dictates that all internet traffic should be treated equally by internet service providers and that they cannot block, slow, or charge more fees for access to specific webpages. This would help ensure equal access to the internet and prevent larger companies from paying to prioritize access to their content, but it would require greater government intervention.

International organizations exploit ultimate beneficial owner policies in different countries to shield bad actors

UBO policies help determine who owns businesses by evaluating who is making the decisions, regardless of the listed owner.

A 1948 Supreme Court ruling realigned the film industry

1948's landmark United States v. Paramount Pictures found that the "Big Five" studios violated antitrust laws, effectively ending the reign of the vertically integrated system and the golden age of Hollywood.

The story of the Sackler empire behind highly addictive OxyContin

This investigative report examines how the Sackler family built its fortune through Purdue Pharma’s aggressive marketing of OxyContin, a highly addictive painkiller. Through 2017, the drug had generated more than $30B in sales for Purdue Pharma, controlled by the Sacklers.

Explaining computer kernels and what makes monolithic kernels different from microkernels

A kernel is an intermediary piece of software on a device that manages the connection between software programs—the services and processes they perform to run correctly—and the available hardware resources, such as memory and computing bandwidth, including prioritizing resource allocation and managing access to specific hardware. A monolithic kernel manages all of an operating system's services, whereas a microkernel only handles essential services.

The stock market, explained in 3 minutes

The stock market consists of a set of exchanges and other venues where shares of public companies are bought and sold. The Nasdaq and the New York Stock Exchange are two of the most well-known exchanges in the US, while major exchanges also operate around the world, including in Tokyo, Shanghai, London, and São Paulo.

James Monroe first outlined what became known as the 'Monroe Doctrine' during his 1823 Annual Message to Congress

President Monroe used his Annual Message to Congress to warn European powers against further colonization in the Western Hemisphere, asserting US opposition to foreign intervention and laying the foundation for a cornerstone of American foreign policy that remains to this day.

An initial public offering or 'IPO' is the process of a private company becoming public by putting shares of the company on the stock market for purchase.

The Nasdaq's 'Magnificent 7' companies are responsible for roughly 40% of the Nasdaq 100 index's gains, while the remaining 93 companies account for the other 60%.

The United States is one of only around two dozen countries with a fully federal system of government, in which power is divided between national and state governments.

Netflix profits when you're not watching, and its movies are designed that way—read a detail-rich critical essay exposing lesser-known Netflix takes

Learn how monoclonal antibodies, which mimic the body's antibodies, can fight diseases like Ebola.

Gerrymandering works through two techniques: cracking opposing voters across districts to dilute their power, and packing them into a few to waste their votes in lopsided majorities.

How Amazon operates a 'flywheel' business model, a self-reinforcing cycle that drives continuous growth

Discover the catastrophic consequences of a failure of the US electrical grid—something that is more likely than many Americans think.

Memecoins are a type of cryptocurrency—a form of digital currency with a wide variety of uses—created around popular 'memes,' or viral internet jokes.

Telehealth demand for GLP-1s for weight loss is booming as consumers seek easier access.

Most of the observable universe's volume consists of voids and supervoids—enormous regions of space with little to no galaxies, stars, or light.

A Yale student wrote a profound essay about the consulting industry's influence on elite college students that was published in a book of her writing after she died in a post-graduation car accident.

Warren Buffett's former professor Benjamin Graham is known as the 'father of value investing,' a strategy in which investors seek to buy stocks trading below their intrinsic worth.

Some researchers have labeled nomophobia, the fear of being without your phone, as 'the phobia of the 21st century.'

A century of Billboard issues documenting the evolution of popular music.

All rainbows are 'raincircles' caused by water droplets separating white sunlight into a spectrum of colors, but Earth's surface blocks the bottom half of the circle from our line of sight.

Volcanoes 'die' when their supply of magma runs out, if they are shifted away from their underlying magma reservoir, or if they get clogged by collapsing or their magma cooling back into rock.

Art theft is the third-largest source of criminal revenues worldwide, thanks in part to the subjective nature of valuing a work of art.

The name 'Silicon Valley' arose from the founding of Shockley Semiconductor Laboratory in Fairchild Semiconductor in 1956-57, founded near Stanford University in Palo Alto

Long before Major League Baseball began allowing instant replay for balls and strikes, an umpire reluctantly used the technology to determine whether a hit was a home run, a move that inadvertently ushered in a new era for the sport.

Louisiana's 'Cancer Alley' is infamous for having some of the highest industrial pollution, toxic air emissions, and cancer risks in the US.

Alzheimer's can lead to brain shrinkage, with an average of around 2% of volume reduction per year

See photos of Meteora, a mountainous site in central Greece, home to 14th-century monasteries perched atop soaring outcroppings.

Famed poet TS Eliot rejected the manuscript for George Orwell's political fable 'Animal Farm,' writing that its criticism of authoritarianism was not 'the right point of view.'

After the Boston Tea Party, colonists switched to coffee, which became the main morning drink for revolutionaries.