Types

The government may run a monopoly itself (or with an independent agency created by that government), or it may allow a private company to sustain a monopoly. (See References 1 and 2.)

Examples

During the nineteenth century, the U.S. government allowed the U.S. Postal Service a monopoly on mail delivery by making it illegal for anyone other than the USPS to deliver mail (see Reference 1). AT&T owned a monopoly on telephone lines until the early 1980s (see Reference 2).

Function

Government run or mandated monopolies usually exist because an entity can provide an essential service consistently and at a relatively low price.

Significance

In the U.S., very few government monopolies exist. The federal government sees monopolies as inefficient and not fair to the consumer, so much so that U.S. antitrust law takes preemptive action to prevent monopolies (see Reference 3).

Criticism

Some people, such as Walter Williams of WorldNetDaily, believe that any government monopoly is a poor idea because monopolies do not need to improve or provide the best service since no competition exists or they can stay in business without a profitable business model (see Resource 1).

Source:

US Postal Service: A Government Protected Monopoly

Legal Monopoly

Monopoly: History, Government Regulation and Exemptions

More Information:

WorldNetDaily.com: End Government's Monopoly on Schools