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In economics, a government-granted monopoly (also called a "de jure monopoly" or "regulated monopoly") is a form of coercive monopoly by which a government grants exclusive privilege to a private individual or firm to be the sole provider of a good or service; potential competitors are excluded from the market by law, regulation, or other mechanisms of government enforcement.
One of the government's few anti-monopoly victories was United States v. AT&T , which led to the breakup of Bell Telephone and its monopoly on U.S. telephone service in 1982. [ 30 ] The general "trimming back" of antitrust law in the face of economic analysis also resulted in more permissive standards for mergers. [ 30 ]
It is a monopoly created, owned, and operated by the government. It is usually distinguished from a government-granted monopoly, where the government grants a monopoly to a private individual or company. A government monopoly may be run by any level of government—national, regional, local; for levels below the national, it is a local monopoly.
Standard Oil (Refinery No. 1 in Cleveland, Ohio, pictured) was a major company broken up under United States antitrust laws.. The history of United States antitrust law is generally taken to begin with the Sherman Antitrust Act 1890, although some form of policy to regulate competition in the market economy has existed throughout the common law's history.
The government may also reserve the venture for itself, thus forming a government monopoly, for example with a state-owned company. [citation needed] Monopolies may be naturally occurring due to limited competition because the industry is resource intensive and requires substantial costs to operate (e.g., certain railroad systems). [3]
The problems don't stop there. The same law that created the regional monopolies also made organ donation expenses fully cost-reimbursed by insurance companies and the federal government.
Patents are legal monopolies granted on practical inventions; Privatization transfers a government-held thing into private ownership; Quantitative easing occurs when the government buys government bonds, raising their price and lowering the return per unit price to people and institutions buying government bonds.
The US government has shut down ten times over the past 40-plus years. Meanwhile, in other countries, governments keep functioning, even in the midst of wars and constitutional crises.