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Anti-Competitive Possibilities in Net Marketplaces

What are some anti-competitive possibilities inherent in net marketplaces?

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In a marketplace that is a 'monopsony', the buyer controls a large portion of the market causing the prices to reduce. 'Monopsony' is also called buyer's monopoly. In a market situation like this, there are many sellers but only one buyer and this gives that buyer enough power to demand from the sellers as there is no other way to sell the goods but to only that person. Oftentimes, 'monopsony' is not desirable as it affects the economy. The lack of competition will lead to inefficiencies resulting to a dead weight loss to the whole economy.

An example of 'monopsony' is the way Ernest and Julio Gallo, the biggest wine makers, as they were the only ones buying the biggest quantity of grapes from the growers. In a market situation like this, the sellers have no other choice but to agree to their terms which typically benefits them more. The system in which a single-payer government healthcare operates is considered a buyer's monopoly. The government is the sole buyer of the health services giving them considerable power over providers of health ...

Solution Summary

Anti-competitive possibilities inherent in net marketplaces are discussed. Examples are provided.

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