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Paper Topic:

Utilities as natural monopolies: Critical Issues in Law and Managment

Utilities as natural monopolies : Critical Issues in Law and Management


Monopoly has been defined as a progressive situation in the market wherein only one service or product provider exists . Sole ownership and management of this production ensures no competition in the industry in which the firm is involved . The powers are being concentrated in a single individual or groups of people managing the single existing firm Such case leads to various legal controversies impregnating different reactions especially in the public and legal conducts . The law-conscious community is reviewing ethical issues

about this controversy searching for any factors of abuse that might be occurring . These issues are covered in this aiming to the present laws , the means of committing violations for these monopolistic powers and the legal considerations involved in this issue

The Monopoly Law : Anti-trust Law

Dated back during 1990s , the economists have become entirely focused in the ongoing competitiveness especially in the commercial field . The frequent changes of the integral character of these business firms and the necessity for employment advancements in the middle of an evident competition and technologically oriented commerce have induced this impulsion . Community institutions have concentrated on promotion of economic efficiency by developing the policies that governs national economy and liberalization and privatization within national economy (Olson 1999 ,

.1-2 . As provided the Anti-trust law , which is statutory , regulatory , and an essential part of the federal legal body that prevents and corrects unreasonable trade restraints , any commercial firms that solely centralize and null the competition , as in the case of monopoly , are actually committing violence against the said law (Emerson 2004 ,

. 485

The Anti-trust law comprises various regulatory laws that maintain capitalism , fair trade and market competition in the economy . Sherman act is the best example of an economic policy that negates unfair competition as promoted by the system of monopoly (Letwin 1981 ,

.3 . As stated by the Section II . Monopolizing trade a felony Penalty of Sherman Act of 1890

Every person who shall monopolize , or attempt to monopolize , or combine or conspire with any other person or persons , to monopolize any part of the trade or commerce among the several States , or with foreign nations shall be deemed guilty of a felony , and , on conviction thereof , shall be punished by fine not exceeding 10 ,000 ,000 if a corporation , or , if any other person 350 ,000 , or by imprisonment not exceeding three years , or by both said punishments , in the discretion of the court

Application of this law provides access to far-reaching principle of the policy that the American economy shall continue competitive economy and null any attempts of eliminating these competitions (Letwin 1981 ,


Committing Violations by Monopoly Powers

Certain controversies ignite the legal bodies regarding the major organization 's increasing monopolization status . According to Pearlstein (2004 , any claims of occurring monopolization power require proof of price manipulation or any attempts to exclude competition in the market provided these are willful initiations and with maintenance of that power...

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