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Essay On John D Rockefeller Monopolies

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A monopoly market is defined as a market in which a single seller, selling a distinct product faces no competition; therefore, making the seller the sole seller of the good without any close substitutes (The Economic Times, 2017). Monopoly markets results in market power, in which the single seller has substantial influence on the market price. The outcome of one seller gaining market power often negatively impacts the economy as a whole. Moreover, when monopolies occur the government interferes for the sake of the economy. Over the years, the United States has faced numerous monopolies, and the government has had to create policies to ensure the protection of markets. One of the most well known monopolies to exist is in the market of oil. John D. Rockefeller, is known as being history’s richest man because influence and presence in the oil industry. He presided over his own oil monopoly, which contributed to his massive wealth. It all started in 1865 when Rockefeller took out a loan to buy out a few of his partners, in efforts to…show more content…
Rockefeller was able to grow his business both horizontally and vertically by purchasing producers and distributors of oil. By 1882, John D. Rockefeller had all of Standard Oil’s properties merged into the Standard Oil Trust. At this time, the company became unstoppable, completely consuming the market, “it controlled 88% of the refined oil flows in the United States” (Selwyn-Holmes, 2009). As the company bought out various rival refineries, they were combined into the Standard Oil Trust, which would eventually control 90 percent of the nation’s refineries and pipelines (History.com, 2010). As the company continuously grew, becoming a monopoly in the oil industry, it began to do everything in its power to exploit economies of scale, such as even building its own oil
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