Discuss a monopoly market of your choice - Essay Example

Monopoly signifies the control of one over many. In the economic scenario, it is control of a single producer or supplier producing or selling the products, the substitute of the products or services are not easily available and there is total control of the output of the industry by the monopolists. In such imperfect market condition the competitor needs to lower the price in order to sell there products and services. The single seller has all the market power and the barriers of entry are high for the new players or entrants.

Wal-Mart is the world’s largest retail organization which had net profits of $378,799.0 as on 2007 which was 7.6% higher than the record of the same on the same period of year 2006. The size of the store can be understood by the following corporate information on Wal-Mart, “Wal-Mart serves customers and members more than 200 million times per week at more than 8,159 retail units under 55 different banners in 15 countries. With fiscal year 2009 sales of $401 billion, Wal-Mart employs more than 2.

1 million associates worldwide.” (Wal-Mart Official Website) Wal-Mart has been accused of monopolizing the retail sector from the past. The acquisitions of being monopolist, monopolist and unfair employee treatments have been part of the success of Wal-Mart stores. The Wal-Mart stores wipe out the local and small businesses in the areas where these start the operations. This kind of monopoly is known as coercive monopoly which is the result of natural growth of the company giving it competitive edge over the other players.

Monopolist takes decisions without the fear of competitive powers. Wal-Mart has been serving various markets from decades. The wide range of household products and services in the specific location encourages customers to visit Wal-Mart only for their daily or specific needs. The position of Wal-Mart as a buyer is strong as it is able to get products in much cheaper price than any small