A monopoly market structure is that where there is a single seller of a commodity having full control over its supply and there is no close substitute. A pure Monopoly exists when there is only one producer in the market. There are no direct competitors.
We can say that when there is a single seller or producer of commodity or service the market structure is called a monopoly market.
Features of Monopoly Market Structure
Following are the characteristics or features of monopoly market structure as given below:
1. Single Seller and Large Number of Buyers
A commodity or service is a characteristic of the monopoly market. Individual buyers cannot influence the price of the product.
2. No Close Substitute
Under the Monopoly market, the commodity or service sold by the seller has no close substitute.
3. One Firm One Industry
The seller or producer of a commodity or service is firm as well as an industry.
There is no distinction between the firm and industry under the monopoly market.
4. Restriction on Entry
Under Monopoly, no form can enter the industry or market as there are several types of artificial and natural restrictions imposed by the monopolist.
This restriction may be in the form of copyright, patent, license, owner of mines, etc.
5. Control Over Supply
Under Monopoly, the seller of a commodity has full control over the supply and he is a price maker.
He is free to fix whatever the charges in order to attain his objective of maximization of profit.
6. Either Price or Supply Fixation
A Monopoly either fixes the price or determines the supply of its product.
He does not do both things simultaneously.
In order to maximize his profit, he will either fix the price or control the supply of his output.
Thus, now you know the features of monopoly market structure.