History of Monopolies

Economic monopolies have existed throughout human history. In ancient and medieval times scarcity of resources was common and affected the lives of the people. When resources were scarce there were little room for multiplicity of producers for many products and services. The medieval guilds for example existed throughout Europe. They were groups of individuals with common goals. Associations of merchants or artisans they controlled output, set terms for entering a trade, and regulated prices and wages. As nation states began to emerge in the late renaissance era, monopoly proved to be a useful device for sovereigns. Monopoly rights were awarded to court favorites for manufacture and trade in basic essentials such as salt and tobacco. The sovereign received an ample share of the profits. Most major European nations also granted monopoly powers to private trading companies so explore and discover new land. The awarding monopoly power by the sovereign to private companies and court favorites. This led to abuse. So in England parliament finally passed a statute of monopolies in 1624.