Form of monopoly in Russia and its types

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

The term "monopoly" means the predominance of a single seller or manufacturer of products in the market. Such an economic entity is an entire industry, independently determines both the market price of its product and its volume of delivery to customers. Monopolies are a product of the development of capitalist relations. Moreover, their very existence is a factor hindering the implementation of any economic reforms by the state.

Do not allow the full development of market relations and various types of monopolies in Russia. And this is a serious task, the solution of which the relevant state bodies are trying to find.

Historical background

At the end of the 19th c. the centuries-old development of the market has undergone significant changes. And they were associated with a real threat of competition. However, a significant obstacle arose in the way of such a necessary market attribute, which was various organizational forms of monopolies.

The history of such economic formations began in ancient times. Various forms of monopolies and their evolution accompanied almost allstages of development of market relations. However, their recent history began only in the last third of the 19th century, especially manifesting itself during the crisis of 1873

Sign of a monopolistic entity

What is this phenomenon? For example, forms of industrial monopolies are nothing more than individual enterprises and their associations, as well as business partnerships that produce significant volumes of certain products. This state of affairs allows organizations to dominate the consumer market and set high prices that bring the greatest benefit.

That is why the main feature of a monopoly is its exclusive position. Enterprises included in such formations significantly limit the competition that arises in the market for a particular product. Of course, a monopoly is desirable for every manufacturer. Indeed, in this case, a certain economic power will be concentrated in his hands, which will allow him to avoid many problems and risks.

Natural monopoly

The state of dominance in the market is classified into different types. There is such a monopoly as natural, as well as administrative and economic. Consider the first one.

The emergence of a natural monopoly is facilitated by a number of objective reasons. At the same time, such formation reflects such a situation on the market, when the demand for a particular product can be satisfied by one company or, in extreme cases, by several. The basis of such a monopoly is the peculiarity of the production of products or uniqueness.consumer service. In such cases, competition is simply impossible or highly undesirable. Such organizations provide energy supply, provide telephone services, etc. Either one or a limited number of companies operate in such industries.

Administrative monopoly

Sometimes an organization begins to dominate the market due to certain actions of government agencies. Such a monopoly is administrative. A prerequisite for its occurrence is the granting by the state of exclusive rights to perform a certain type of activity. Moreover, such structures, as a rule, consist of state-owned enterprises subordinate to various associations, ministries and central administrations.

An administrative monopoly includes a whole group of economic entities of the same industry, acting on the market as a whole. Such formations were dominant in the former USSR.

Economic monopoly

This form of formations is the most common. It appears in connection with the emergence of certain economic reasons and is built according to the laws of economic development.

Thus, one can speak of an economic monopoly in cases where entrepreneurs gain a dominant position in the market in two ways:

• concentration of capital with a constant increase in the scale of the enterprise;
• centralization of capital with the accession or absorption of bankrupt firms.

By going the first or second way, the enterprise reaches such a size that allows it to dominate the market.

International Monopoly

This kind of education is of a special kind. It arises at a high degree of socialization of capitalist production and the development of processes of interpolation of economic life.

What types of monopolies can be attributed to the international type? The first one is transnational. Such a monopoly is national in terms of its capital and control over it, but it is international in its field of activity. Such forms of capitalist monopolies as concerns are clear evidence of this. For example:

1. Standard Oil of New Jersey Concern. This is an American oil company, whose enterprises are located in more than forty countries around the world. Moreover, the concern placed 56% of its assets abroad, carrying out 68% of sales there, receiving 52% of the profit.
2. Swiss food concern Nestle. The bulk of its production facilities and sales organizations are located in other countries. In Switzerland, only a small share of the turnover of goods (2-3%) is carried out.

There are also international monopolies proper. All concerns and trusts that can be described by this term have a number of features.

Their differences, first of all, consist in the fact that their share capital is internationally dispersed. The main core of employees are people of different nationalities. An example of such a combinationis:

• Anglo-Dutch concern "Unilever", working in the chemical and food industry;
• Belgian-German trust "Agfa-Gevert", producing photochemical products.

The number of such monopolistic organizations is small, which is explained by the difficulties of combining capital of different national origin - these are differences in legislation, double taxation, opposition from government officials, and much more.

Forms of monopolies

There is a certain classification of organizations that occupy a dominant position in the market. This list includes a number of basic forms in which monopolistic enterprises can unite. The simplest of them arose in the sphere of circulation. Among them:

1. Cartel is a form of monopoly that combines several enterprises operating in the same production area. Participants in such a system have commercial independence, retain ownership of the means and tools, and independently dispose of the product they have released. Cartel members only agree on the size of their share in the total production volume, on sales markets and set prices for goods.
2. A syndicate is a form of monopoly, which is an association of some enterprises belonging to the same industry, which retain ownership of the means of production, but do not have commercial independence due to the lack of the right to sell their goods. In this case, the sale of products is carried out by the general marketingoffice.

There is a more complex form of monopoly. Such enterprises cover the sector of direct production. One of the main forms of monopolies of this type is a trust. Such an association includes enterprises of either one or several branches of industrial production at once. The members of the trust have no ownership of either the means of production or the product they produce. They also lack commercial independence. In other words, in trusts there is a union of production, marketing, finance and management. The advantage of such an association is that each of its participants has its share of shares proportional to the share of invested capital. Such a package gives the right to participate in the management of the trust and receive its share of the profits from it.

There is another complex form of monopoly - a diversified concern. It combines dozens and even hundreds of enterprises belonging to various industries, trade and transport. Participants in such a monopoly lose their right to ownership of the means of production, as well as to the product they produce. In addition, all enterprises are subject to financial control by the parent company.

The emergence of monopolies in Russia

Formations consisting of market-dominating organizations emerged in our country as well. And for the first time they started talking about monopolies in Russia at the end of the 19th century. These communities developed along a peculiar path, which was distinguished by direct intervention in their affairs.government agencies. The government exercised its influence on the development of organizations in the metallurgical sphere, mechanical engineering, transport, sugar and oil industries. That is why the types of monopoly in Russia, as a rule, were limited to the administrative type. However, before the beginning of the 20th century. the role of such organizations in the country's economy was insignificant.

Russia's transition to imperialism

In 1900-1903. the global economic crisis broke out. It became the main impetus that led to the accelerated and massive formation of monopolies in Russia. To determine ways out of the crisis, industrialists began to gather at industry congresses. And at the same time, the main recipe for solving the problem was developed. It consisted in the creation of united trade organizations that sell manufactured goods. Thus, the lowest forms of monopoly appeared in Russia, which are syndicates. These organizations controlled the prices in the market.

Syndicates, as the first forms of monopoly, arose in Russia due to protective state duties that protected the domestic market. The appearance of such formations was also facilitated by government orders, when the state arranged competitions, giving preference to the company that set the lowest price.

Thus, at the beginning of the 20th century. such syndicates as "Prodamet", "Prodvagon", "Produgol", "Roof" appeared.

In parallel with syndicates, such a form of monopoly as a trust began to form. Gradually, formations of the “higher type”, that is, concerns, also appeared. Similar associations were developed incotton industry. Moreover, entrepreneurs, having accumulated large sums, first took possession of banks, and then began to invest their funds in underdeveloped industries. At that time, they were such industries as automotive, electrical and chemical.

International types of monopoly in Russia operated in the oil industry. They came to our country in the form of trusts that divided the world markets among themselves. In Russia, there were three representatives of such a monopoly at once. Among them:

• Royal Dal Shell is an Anglo-Dutch trust.
• "Nobel Partnership", the main capital of which belonged to German industrialists.
• Russian General Oil Corporation, created on the basis of Anglo-French investments.

In general, the monopolists brought obvious damage to the national economy of the country. They kept high prices for their products, sometimes limiting the extraction of fuel and energy resources. That is why the Russian government had to deal with such a phenomenon as a monopoly. They tried to limit the types and forms of such education by various legislative acts. However, everything was in vain, since most government officials held high-paying positions in various companies in parallel with government work.

Industrial decline

Some local monopolies in Russia ceased their activities due to the outbreak of the First World War. But in general, during the period of hostilities, the number of such formationsonly increased. Some concerns, as the highest form of monopoly, have become even more powerful. Moreover, many of them have significantly increased their capital, producing military products.

After the October Revolution, banks and industry were nationalized. As a result of this process, monopolies in Russia were liquidated. The emergence of such formations began again after the 90s, when the country began to move towards market relations.

Modern stage

To date, there are no pure monopolies in Russia. There are only individual enterprises whose products occupy a significant market share (65 percent or more). The main form of monopoly in Russia is large associations. Moreover, they all belong to the type of natural formations. Such monopolies were created by the state itself when pursuing a policy of specialization, deepening and concentration of production. However, economic crises have clearly shown that such structures are extremely unstable.

In addition, in Russia there is such a type of monopoly as local. It arises due to the unsaturation of the market, when individual enterprises, against their will, begin to occupy a dominant position. This list often includes organizations involved in the processing of agricultural products, as well as trade, medical and consumer services.

There are only three largest monopolists in Russia:

• RAO "UES", engaged in the production of electricity and providingservices for its delivery to the consumer.
• Gazprom transporting gas through pipelines and selling it to the population.
• MPS leading rail traffic.

Rostelecom can be included in the same list. This organization provides international and long-distance communication services. Smaller monopolists organizing their activities in cities are Vodokanal, Metropolitan, etc. All of them are able to regulate the price of their product, limiting its supply for the consumer.

Sometimes monopolists abuse the power in their hands. They set too high prices, thus covering their unreasonable costs. In addition, in the Russian economy there is a discriminatory attitude on the part of monopolies towards their competitors. An example of this is the decision of the administration of the Kirov region, which created a state-owned enterprise, which included previously independently operating pharmacies, a pharmaceutical factory, a pharmacy base and a control and analytical laboratory. Such an association ceased its activities by decision of the State Antimonopoly Committee.