Introduction:

The word monopoly is a Latin word which is composed of two words mono and poly. meaning single and seller. A monopoly is market situation in which a single seller or a firm sells the product for which there is no substitutes. There is one seller and large number of buyers , there is no substitutes, strict barrier on entry and sole seller control the supply of the commodity. The types of monopoly are:

Types of Monopoly:

A monopoly is a market condition where a single seller controls the entire supply of a product or service, and there are no close substitutes. Monopolies can be classified based on various factors such as origin, ownership, and nature of control.

1. Natural Monopoly: It is a type of monopoly that arises when a single firm can supply the entire market at a lower cost than two or more competing firms due to economies of scale. It occurs in an industry where the cost of production is so high (especially fixed costs) that it is most efficient for one large firm to serve the entire market, rather than having many smaller competitors. The examples of natural monopoly are Electricity supply, Water distribution, Railway services, Gas pipelines.
2. Legal Monopoly: It is also known as a Statutory Monopoly, it is a market situation where a firm is granted exclusive rights by the government to produce, supply, or sell a particular product or service. A legal monopoly exists when a firm is protected by law from competition, meaning no other firm is allowed to enter the market for that particular product or service. Examples for legal monopoly are Reserve Bank of India, India post, copyholders.
3. Technological Monopoly: It is a type of monopoly that exists when a single firm controls a unique technology, innovation, or production method that other firms cannot legally use it is usually protected by patents, copyrights, or trade secrets. A technological monopoly arises when a company gains exclusive rights to produce or sell a product due to technological innovation that cannot be duplicated by competitors. Microsoft, pharmaceutical firm are the examples.
4. Government Monopoly: Is a type of monopoly where the entire market for a particular good or service is owned, operated, and controlled by the government. A government monopoly exists when the state or a government agency is the sole provider of a product or service, and no private competition is allowed by law or policy. Public transport, Railways, Postal services, are the examples of govt monopoly.
5. Private Monopoly: It is a market situation where a single private individual, company, or business firm controls the entire supply of a product or service, with no close substitutes and no competition. a private monopoly is formed when a private firm becomes the sole producer or seller of a product in the market, either by controlling resources, technology, or eliminating competition. Examples are a private firm having sole rights to produce a specific good in a region.
6. Pure Monopoly: It is the form of monopoly where a single seller controls the entire supply of a product or service in the market, and there are absolutely no close substitutes available to consumers. A pure monopoly exists when one firm is the sole producer of a product, with 100% market share, no competitors, and no substitute goods. A local water supply system in a small town, A utility provider (like electricity) in an area with no alternatives, A government currency issuer (e.g., Reserve Bank issuing currency).
7. An Imperfect Monopoly: It is a market situation where a single firm dominates the market, but some distant substitutes for its product or service do exist. It is not a complete monopoly like a pure monopoly. An imperfect monopoly exists when one firm is the major or sole producer of a product, but alternative or substitute goods are available in the market, though they may not be close or perfect substitutes. Microsoft windows, google search engine, apple I phones Etc. are the examples of imperfect monopoly.

also read: explain its concepts of terms of trade.