ABSTRACT
In this chapter, the author considers what methods are available under conditions of monopoly. The State, then, contemplating a monopoly or the possibility of a monopoly in some industry, may be supposed to contrast the dividend under it with the dividend under simple competition. In industries where monopolistic power is liable to be introduced through the development of combinations, it is open to the State, if it chooses, to aim at preventing monopoly power from arising, or, if it has arisen, at destroying it. A monopoly makes no proper use—at all events is under temptation to make insufficient use—of that invaluable agent of progress, the scrap heap. In controlling monopoly, it is required to prevent the monopolist from charging high prices, because, by so doing, he reduces output below the level at which he could put it with normal profits to himself. In the regulation of monopoly charges there is, of course, no need for any of the secondary arrangements.
