I. GENERAL CONSIDERATIONS
Monopoly consists in the factual or legal exclusive ability, vested in a single subject, to sell certain goods or to trade in them. If the subject holding this ability is the State, a public monopoly exists; if instead it is a private individual or company, a private monopoly exists. The latter is natural when it results from the spontaneous course of events, as occurs with patented inventions; it is artificial when it is the result of speculative maneuvers by individuals or associations who seize control of the entire supply of a given commodity in a given market.Monopolies take many forms, distinguished by the diversity of their aims and the technical procedures by which they are established and operate. Among the most complex are trusts. All these different forms, however, share the suppression of competition, which, within just limits, is a natural stimulus to good production and well-remunerated labor.
MONOPOLI, DIOCESE OF – Last Supper. Fresco by Francesco De Mura (1755) – Monopoli, Cathedral.
II. MORALITY
A public monopoly can be justified only by the exigencies of the common good. The authority then determines its limits in accordance with its concrete objectives, which may be fiscal in nature, as, for example, in the case of the tobacco monopoly, or police-related, as in the case of the alcohol monopoly. A natural private monopoly arises spontaneously within the sphere of natural law; positive law establishes its limits, but always with the aim of protecting and fostering the products of human ingenuity.An artificial monopoly easily provides a field for speculative gain, well-disguised by cupidity, and thus economically more favorable and morally more dangerous. It is not, in itself, illicit, though in practice it rarely fails to offend commutative or social justice, or charity.
It is always just when the elements composing it are just, namely, its aims—if they are rather defensive—and the means employed to achieve them—if they do not violate another’s right. The just price is ordinarily the sign that the monopoly is not unjust in its elements or means. Two criteria are given for determining such a just price, to be used as appropriate, one or the other, according to different cases. The first criterion: like any other price, the monopoly price is just when, in the judgment of experts, after deducting expenses, it allows a moderate profit to the producer or trader. The other criterion: the monopoly price is just when it is equal to the price that the commodity, now monopolized, would have on the same market if it were, however, free. That is, the process of monopolizing a commodity must in no way increase its price. Indeed, the advantage that a monopoly confers on its holder lies solely in the fact that all the profit from a given commodity is concentrated in one hand; for monopolization removes the possibility for any other competitor to share in the production or trade of the same commodity. Who can fail to see, then, that the process of monopolization has no effect whatsoever on the price? While the price concerns only the relationship between seller and customer, monopolization instead affects only the relationship between seller and those bound to him. Hence any increase in price resulting from monopolization is unjustified.
Monopoly, therefore, is not in itself illicit. In practice, however: 1) those monopolies that speculate on an increased price are unjust toward buyers; 2) those monopolies that, while leaving prices unchanged, stifle competition through unjust or offensive methods, violate commutative justice or charity toward competitors; 3) those monopolies that, without offending customers or competitors, aim to influence public governance to the advantage of private interests are an injury to social justice, as has occurred in some American states at the hands of certain trusts. It goes without saying that these various faults may in fact burden the same monopoly.
Finally, it is not superfluous to recall the general principle according to which, from the offense against commutative justice, there arises, along with moral guilt, the obligation to repair the damages caused.
LEONARDO AZZOLINI