How Did Monopolies Affect The Economy
How would you feel if you went shopping and your only options are the awful red Nike shirt or the really bright green Nike shirt, and that both cost 55 dollars? In the early twentieth century, the United States went through one of the most influential changes which impacted economic growth. This change was known as the second economic revolution. This economic growth came with the benefits of abundant resources, an increase in labor, a growing market, and available capital investment. However, with all of this growth, there were also some setbacks. A huge setback was the over growing power of monopolies (Foner, 34 ). “A monopoly is a market structure characterized by a single seller, selling a unique product in the market, with no competition” (The Economist,1). Monopolies, during the Industrial Revolution, were bad because of overpriced items, corruption, and a lack of clothes and apparel.
First, monopolies could overcharge people for simple items without caring about the quality of the product. “Overcharging or price discrimination allows a monopolist to increase its profit by charging higher prices for identical goods to those who are willing or able to pay more,” (Burgan, 1). …show more content…
Endowed market power, monopolies overcharged people for items without caring about the quality of the product. Companies, such as Rockefeller, used corruption and bribes to become the biggest and most powerful companies. Monopolies also limited the people’s choices in clothes and apparel. Due to all these problems, Congress decided to pass a law called The Sherman Antitrust Law that gives federal and state governments permission to regulate the conduct and organization of business corporations and promote fair competition for the benefit of
First, monopolies could overcharge people for simple items without caring about the quality of the product. “Overcharging or price discrimination allows a monopolist to increase its profit by charging higher prices for identical goods to those who are willing or able to pay more,” (Burgan, 1). …show more content…
Endowed market power, monopolies overcharged people for items without caring about the quality of the product. Companies, such as Rockefeller, used corruption and bribes to become the biggest and most powerful companies. Monopolies also limited the people’s choices in clothes and apparel. Due to all these problems, Congress decided to pass a law called The Sherman Antitrust Law that gives federal and state governments permission to regulate the conduct and organization of business corporations and promote fair competition for the benefit of