MONOPOLY. The term monopoly, in its early usage, was applied to grants from the Crown, to a favourite or as a reward for good service, of the exclusive right to manufacture or sell particular classes of goods. Not until the reign of Henry VIII. does much evidence appear of these grants in the case of either new inventions or familiar articles of trade. Elizabeth granted patents of monopoly so freely that the practice became a grave abuse, giving rise to serious complaints in the House of Commons, and to the suppression of many exclusive rights in 16o1. In the first parliament of James I. a "committee of grievances" was appointed and again many monopoly patents were cancelled. Many more. however, were granted by the king, and there grew up a race of "purveyors" who made use of the privileges granted them under the great seal for various purposes of extortion. After the intro duction of several bills, and several attempts by James to compro mise the matter by orders in council and promises, the Statute of Monopolies was passed in 1624. This Statute made all monopolies illegal, except such as might be granted by parliament, or were in respect of new manufactures or inventions, or were exercised by civic corporations or companies and it would no doubt have greatly diminished the evils of monopoly had it not been for subsequent transgressiong of the Act based in the main upon these excepting clauses. Under Charles I., the local monopoly of civic corporations began to be used as a cover for national mo nopolies. This was accomplished by the corporation obtaining from the sovereign a right of "superintendence" over the whole national production of the article, which in practice meant a strangle-hold upon rival producers. The grant of patent rights for new inven tions was similarly abused by the according to the patentees of Crown rights of surveillance over all other producers of the commodity; while the title exercised by the Crown over all mines producing gold and silver was used as a basis for monopolistic control over tin, lead, and copper mines, of which the precious metals were an incidental by-product. In 1640, however, the Long Parliament declared most monopolies void, and the Bill of Rights ended, in 1689, the claim of the Crown to override the law.
In its modern usage the term monopoly is applied to the advantage accruing to any undertaking or associated group of undertakings which has the power, however acquired, of fixing the price of its goods or services in the knowledge that those who need them cannot get them in adequate measure elsewhere. Vestiges of the earlier usage remain in the monopoly conferred for a term of years under the patent and copyright laws ; in the territorial monopolies accorded by Parliament to railway, gas, water, and electricity companies ; in the monopoly exercised by the state in respect of postal, telephone and telegraph services; and in the partial monopoly which may occur where trading is permitted only under licence, as in the case of the sale of alcoholic liquors, wireless broadcasting, the plying of vehicles for public hire, etc. These monopolies, however, are based on a genuine public interest.
Patent rights are conferred that an inventor may publicly disclose the details of his invention ; parliamentary powers are required in order that duplication, inconvenience, and waste may not occur from two or more public utility services operating in the same area; and licences are required in order that certain traffic may be under limitation and control. State-accorded mo nopolies or quasi-monopolies are usually granted on conditions imposed in the interest of the revenue or the public—on the payment of licence or patent fees, the observance of a tariff scale, or the acceptance of the principle of limitation of profits.
Examples of monopolies are numerous. The village shop is "a filonopoly" when there is no rival shop in the neighbourhood. When greyhound racing suddenly became popular, the breeders were able to demand pounds where six months before they would have been glad of shillings. The proprietors of estates near which a railway is driven, or over which an industrial population spreads, find themselves the holders of a commodity which cannot be multi plied and the beneficiaries of a demand for their property in the creation of which they have had no part. A monopoly may be due to the sheer excellence of the services rendered by particular concerns.