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monopoly

muh-NOP-uh-lee /məˈnɒpəli/

nounB2GREGMATSATCATUPSC

FormalAcademicBusiness

Exclusive control or possession of the supply of or trade in a commodity or service by a single enterprise.

Implies complete control over pricing and supply due to an absence of direct competitors.

The story behind the word. The term was coined in ancient Greece from 'monos' (alone, single) and 'polein' (to sell). Aristotle famously used the word in his 'Politics' when telling the story of Thales of Miletus, who bought up all the olive presses during an off-season harvest to control the press market once the olives arrived.

Word relationships

corner: Cornering refers to buying up supply to control prices temporarily, whereas monopoly is a structural market state.
dominance: Dominance implies having high market share, but not necessarily 100% control like a true monopoly.

perfect competition: A market model where numerous buyers and sellers ensure no single entity can influence market prices.

Commonly confused with

monopsony: Monopoly means one single seller; monopsony means one single buyer.

Word family

monopolist (noun): A person or firm holding a monopoly.
monopolize (verb): To obtain or exercise exclusive control over something.
monopolistic (adjective): Having traits or characteristics of a monopoly.

Collocations

natural monopoly
monopoly power
grant a monopoly
state monopoly

Idioms & expressions

have a monopoly on (something)

Example sentences

"The Standard Oil Company was broken up after building a virtual monopoly over American oil refining." Economic history commentary
"A pure monopoly rarely exists without government grants, patents, or extreme economies of scale." Regulatory decision context

Memory hook

MONO (single) + POLY (seller) = A single seller sitting alone on top of the market. Mono = one, Poly = sell.

When not to use

Do not use when a few powerful firms share market control; that is an oligopoly.

Fun facts

The popular board game 'Monopoly' was originally created in 1903 by Lizzie Magie as 'The Landlord's Game' to demonstrate the negative economic impact of land monopolies.