4 ms·

43% is a massive market share but a monopoly by the definition of the word has near 100% control of a market. I think the modern test is is it possible for so

43% is a massive market share but a monopoly by the definition of the word has near 100% control of a market. I think the modern test is is it possible for someone to compete with Amazon? Costco and Wallmart certainly do. If you break up Amazon, I think online retail will just move to the next biggest player.

gamblor956 8y ago
That is not, not has it ever been, the legal definition of monopoly.
- throwawaymath 8y ago
  What is the legal definition of a monopoly? As a followup, should that definition remain the legal definition of a monopoly? Do we need a modern appraisal of that definition?
  - y4mi 8y ago
    A monopoly is when there is no competition. There can be seller and buyer monopolies. While having a huge market share is a given in such a situation, it's nonetheless not the definition
    - reallydude 8y ago
      Competition is just a weasel word. Existence of multiple parties with overlapping interests is not competition. ie A participant in the market is ignored by the dominant player, who continues to dominate (regardless of any comparable metric), it's a functional monopoly. This is why companies often describe their product as "trust" more so than any specific feature set.
    - tathougies 8y ago
      A buyer 'monopoly' is called a monopsony, not a monopoly.
- everdev 8y ago
  The literal definition of the word implies a 100% share: > A monopoly (from Greek μόνος mónos ["alone" or "single"] and πωλεῖν pōleîn ["to sell"]) exists when a specific person or enterprise is the only supplier of a particular commodity. [1] 1. https://en.wikipedia.org/wiki/Monopoly https://en.wikipedia.org/wiki/Monopoly The legal definition implies a tremendous advantage such that consumers would have no alternatives if the company raised prices: > courts ask if the firm has "monopoly power" in any market. This requires in-depth study of the products sold by the leading firm, and any alternative products consumers may turn to if the firm attempted to raise prices [2] 2. https://www.ftc.gov/tips-advice/competition-guidance/guide-antitrust-laws/single-firm-conduct/monopolization-defined https://www.ftc.gov/tips-advice/competition-guidance/guide-a... I don't think Amazon can raise prices substantially without negatively affecting their market share. Costco, Walmart and Google Express are big enough players that they could handle an increase in volume if Amazon tries to raise prices beyond what the market is willing to bear.
chc 8y ago
This definition kind of punts the question on to the definition of "compete." Microsoft in the 1990s was probably the most clear-cut monopoly in most of our lifetimes, and they still had multiple competitors (e.g. the then-beleaguered Apple), which they did try to use as a defense. I think the key factor is more about whether you believe the competitors are a credible threat. If it doesn't seem like a company is realistically beatable under the current circumstances, that's sort of what we're looking for when we talk about monopolies.
- everdev 8y ago
  And in retrospect, it would have been a mistake to break up Microsoft. No one is advocating breaking them up today. And that happened just through market forces and time, no government intervention needed.
  - chc 8y ago
    There was absolutely intervention from multiple governments, and it scared Microsoft so much that they changed their company culture to studiously avoid even the appearance of monopolism — because they knew that if they ever got brought to court again, the break-up would almost certainly happen. If it had really been left just to market forces and time, Apple might have gone under (Microsoft actually propped them up when they were struggling in order to keep up the facade of competition), and Microsoft would have brought their might to bear against all the competitors that have risen up since then instead of being the gentle giant we have known for the past couple of decades.

gamblor956 8y ago

That is not, not has it ever been, the legal definition of monopoly.

throwawaymath 8y ago
What is the legal definition of a monopoly? As a followup, should that definition remain the legal definition of a monopoly? Do we need a modern appraisal of that definition?
- y4mi 8y ago
  A monopoly is when there is no competition. There can be seller and buyer monopolies. While having a huge market share is a given in such a situation, it's nonetheless not the definition
  - reallydude 8y ago
    Competition is just a weasel word. Existence of multiple parties with overlapping interests is not competition. ie A participant in the market is ignored by the dominant player, who continues to dominate (regardless of any comparable metric), it's a functional monopoly. This is why companies often describe their product as "trust" more so than any specific feature set.
  - tathougies 8y ago
    A buyer 'monopoly' is called a monopsony, not a monopoly.
everdev 8y ago
The literal definition of the word implies a 100% share: > A monopoly (from Greek μόνος mónos ["alone" or "single"] and πωλεῖν pōleîn ["to sell"]) exists when a specific person or enterprise is the only supplier of a particular commodity. [1] 1. https://en.wikipedia.org/wiki/Monopoly https://en.wikipedia.org/wiki/Monopoly The legal definition implies a tremendous advantage such that consumers would have no alternatives if the company raised prices: > courts ask if the firm has "monopoly power" in any market. This requires in-depth study of the products sold by the leading firm, and any alternative products consumers may turn to if the firm attempted to raise prices [2] 2. https://www.ftc.gov/tips-advice/competition-guidance/guide-antitrust-laws/single-firm-conduct/monopolization-defined https://www.ftc.gov/tips-advice/competition-guidance/guide-a... I don't think Amazon can raise prices substantially without negatively affecting their market share. Costco, Walmart and Google Express are big enough players that they could handle an increase in volume if Amazon tries to raise prices beyond what the market is willing to bear.

chc 8y ago

This definition kind of punts the question on to the definition of "compete." Microsoft in the 1990s was probably the most clear-cut monopoly in most of our lifetimes, and they still had multiple competitors (e.g. the then-beleaguered Apple), which they did try to use as a defense. I think the key factor is more about whether you believe the competitors are a credible threat. If it doesn't seem like a company is realistically beatable under the current circumstances, that's sort of what we're looking for when we talk about monopolies.

everdev 8y ago
And in retrospect, it would have been a mistake to break up Microsoft. No one is advocating breaking them up today. And that happened just through market forces and time, no government intervention needed.
- chc 8y ago
  There was absolutely intervention from multiple governments, and it scared Microsoft so much that they changed their company culture to studiously avoid even the appearance of monopolism — because they knew that if they ever got brought to court again, the break-up would almost certainly happen. If it had really been left just to market forces and time, Apple might have gone under (Microsoft actually propped them up when they were struggling in order to keep up the facade of competition), and Microsoft would have brought their might to bear against all the competitors that have risen up since then instead of being the gentle giant we have known for the past couple of decades.