Monopoly and Competition

Abstract

Monopoly, the world famous board game of capitalist strategy, offers its players the opportunity to buy not only Park Lane or Leicester Square, but also to acquire an electric company, a water works or one of four railway stations. British players accustomed to monolithic nationalized utilities would until the 1980s have found this concept puzzling. But even when transferred to the private sector, each utility retained a substantial amount of monopoly power. More than fifteen years after the process of privatization began, public opinion remains hostile to the idea of these now private companies making large profits and paying their directors generous salaries. A few of these companies still retain their monopoly, but they are now bought and sold in a way that was not envisaged when they were privatized and the need to regulate market power and resolve disagreements over licences brings the utilities into the ambit of the MMC (now the Competition Commission) and the Office of Fair Trading.

‘If there is a market, regulators are redundant and if there is no market regulators do not know what to do.’

Colin Robinson, 1996, p. 138.