Economics

Coercive Monopoly

Coercive Monopoly

Coercive monopoly is usually a business concern which is operating in an environment where competitors are being prevented from going into the field, that the firm has the capacity to raise prices and make production selections, without risk regarding competition arising in order to draw away their customers. A coercive monopoly has very few incentives to maintain prices low and may even deliberately price gouge consumers by curtailing production.