Definition
A monopoly is the exclusive control over a market, commodity, trade, or service, held by a single person, company, or group, such that competition is effectively excluded and the holder can dictate terms of supply or price. Two related but distinct meanings appear in legal usage:
1. STRUCTURAL MONOPOLY. The condition of a market in which one actor controls so large a share of supply or trade that competitive forces cannot operate normally. In antitrust law, this is typically the target of enforcement: unlawful monopolization requires not merely possessing monopoly power, but willfully acquiring or maintaining it through exclusionary conduct.
2. GRANTED MONOPOLY. A privilege or exclusive right conferred by sovereign authority — historically by royal grant, later by patent, franchise, or charter — allowing one party to engage in a trade, manufacture an article, or sell a commodity to the exclusion of all others. Patents and public utility franchises are modern survivals of this form.
The two meanings coexist in legal research. A granted monopoly may be entirely lawful (a patent). A structural monopoly may be unlawful if achieved or maintained by anticompetitive means. Context determines which sense applies.
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Common Language
Modern common usage (Wiktionary): A board game in which players use play money to buy and trade properties, with the objective of forcing opponents into bankruptcy.
Historical common usage (Webster's 1913): The exclusive power, or privilege of selling a commodity; the exclusive power, right, or privilege of dealing in some article, or of trading in some market; sole command of the traffic in anything, however obtained.
The Webster's definition maps closely onto the legal sense and reflects genuine continuity of meaning through the nineteenth century. The Wiktionary definition — referencing the board game — captures the dominant popular association in modern usage but is entirely irrelevant to legal research. Researchers citing historical popular or political discourse about monopoly (particularly in the Gilded Age and Progressive Era) will find the Webster's sense operative throughout those sources.
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Common Confusion
MONOPOLY vs. OLIGOPOLY vs. MARKET POWER: These terms occupy distinct positions in antitrust analysis. A monopoly implies single-firm dominance; an oligopoly describes a market controlled by a small number of firms, none of which alone constitutes a monopoly. Market power is the broader economic concept — the ability to raise prices above competitive levels — which may exist in degrees well short of monopoly. Antitrust law concerns itself with all three, but the legal standards and remedies differ. Historical legal sources often use "monopoly" loosely to cover what modern economics would call oligopoly or coordinated market dominance. Researchers should not assume that historical accusations of monopoly map neatly onto modern antitrust categories.
MONOPOLY vs. MONOPSONY: A monopoly is exclusive control on the supply side; a monopsony is exclusive control on the demand (buyer) side. The distinction matters increasingly in modern antitrust enforcement, particularly in labor markets, but historical legal sources rarely use the term monopsony. Researchers encountering complaints about buyer-side market control in older sources may find the underlying conduct described in other terms.
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Recognized Forms
/SUBTYPES
Natural Monopoly: A market condition in which the economics of scale or infrastructure costs are such that a single provider can serve all demand more efficiently than competing providers. Public utilities are the paradigm case. Courts and legislatures have historically treated natural monopolies as warranting regulation rather than structural breakup.
Legal Monopoly (Granted Monopoly): An exclusive right conferred by law — including patents, copyrights, and public franchises. These are not antitrust violations because the exclusivity is state-sanctioned. The line between lawful legal monopoly and unlawful extension of that monopoly into adjacent markets is a recurring antitrust question.
Attempted Monopolization: A distinct legal theory under U.S. antitrust law, requiring proof of specific intent to achieve monopoly and a dangerous probability of success. It is not the same as having monopoly power, and the elements and standards differ from those governing completed monopolization.
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Why It Matters in Research
The word "monopoly" carries dramatically different freight depending on the era of the source. In English common law materials and early American sources, monopoly is almost entirely a concept about crown grants and chartered privileges — the abuse of sovereign power to exclude subjects from lawful trades. The historical grievance runs from the Statute of Monopolies (1624) forward. This context is essential for reading Blackstone, colonial-era political documents, and early constitutional commentary, where "monopoly" functions as a term of political condemnation, not economic analysis.
In the late nineteenth and early twentieth centuries — the period surrounding the Sherman Antitrust Act (1890) and subsequent federal legislation — monopoly becomes a structural and economic term as well as a political one. The Gilded Age debates about railroad trusts, Standard Oil, and combinations in restraint of trade introduced the modern antitrust sense. Sources from this period use both senses simultaneously and sometimes imprecisely. Researchers must determine whether a given source is condemning a granted privilege, describing a structural market condition, or simply using "monopoly" as political rhetoric.
In modern law, the term is almost always encountered in its antitrust sense, governed by the Sherman Act, Clayton Act, and FTC Act in federal law, with state counterparts. The legal test for unlawful monopolization is not merely having monopoly power (defined by courts as a large share of a relevant market plus the ability to control prices or exclude competition), but willfully acquiring or maintaining it. Possession of monopoly power lawfully — through superior product, business acumen, or historical accident — is not itself a violation.
Researchers using the Law Mind corpus should be alert to the corpus connections between antitrust materials, patent law (where granted monopolies are the explicit subject), regulated industries, and constitutional due process and commerce clause doctrine. The concept of monopoly touches all of these.
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Historical Dictionary Support
Black's Law Dictionary (both editions) defines monopoly as a privilege or peculiar advantage in commercial law — the exclusive right to carry on a trade, manufacture an article, or control the supply of a commodity — and cross-references the English definition as a license or privilege allowed by the king. The framing reflects the granted-monopoly tradition more than the structural-antitrust tradition, which is unsurprising given that the first edition of Black's predates the full development of Sherman Act doctrine.
Bouvier's Law Dictionary takes a more pointed stance, defining monopoly as "the abuse of free commerce" by which one or more individuals procure the advantage of selling alone, to the detriment of the public. The framing as abuse is notable — Bouvier treats monopoly as inherently wrongful, not merely descriptive of a market condition. This is consistent with the historical common law hostility to monopoly as a form of oppression, and researchers will find this normative coloring throughout pre-antitrust era sources.
None of the historical dictionaries fully anticipate the modern antitrust distinction between lawful monopoly power and unlawful monopolization. The structural economic analysis — relevant market definition, market share thresholds, the distinction between acquiring and maintaining monopoly — is absent from all shelf sources. This is among the more significant gaps between historical legal dictionary coverage and current doctrine. Researchers relying solely on historical definitions will find them useful for understanding the political and common law tradition but insufficient for modern antitrust analysis.
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Jurisdictional Note
Federal antitrust law governs monopolization in the United States under the Sherman Act, but most states have parallel antitrust statutes that may apply different standards, particularly to intrastate commerce or industries subject to state regulation. In the European Union, monopoly and market dominance are addressed under Article 102 of the Treaty on the Functioning of the European Union, which applies different standards than U.S. law — notably, dominance alone may trigger obligations absent any exclusionary conduct element required by U.S. doctrine.
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Encyclopedia Cross-Reference
See Law Mind Encyclopedia: Antitrust Law (Sherman Act framework, monopolization elements, market power analysis); Market Power (economic and legal definitions, relevant market); Patents and Intellectual Property (lawful granted monopolies and their limits); Regulated Industries and Public Utilities (natural monopoly doctrine and franchise regulation).
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