Page:The New International Encyclopædia 1st ed. v. 13.djvu/817

* MONOPODIAL BRANCHING. 733 MONOPOLY. in which tlic axis of a plant (k'velops cnntinu- ously from an apical and the branches arise from lateral ends. See Bbanciii.nu. MONOPOLI, mo-nop'd-Ie. A town in the I'rov iiicc ni Ijari, Italy, situated on the Adriatic, 25 miles southeast of Bari (Jlap: Italy, il 7). It is surroiuuled by walls, and has a fortress constructed in 1552 by Charles V. There is a cathedral. Along the coast near by are curious tombs hewn out of the rock, anil the ruins of an ancient city. Weavinjr and dyeing are the prin- cipal industries. The trade is in olive oil and wine. Population (commune), in 1S81, 20,918; in 1901, 22,545. MONOPOLY (Lat. nioiiopoUum, from Gk. ^om- TTwXiov, riiilil of exclusive sale, /jovoirwla^ mono- pOliu, exclusive sale, from fi6ms, monos, single + ffuXeiv, jiOlciit, to sell). In its strictest sense, a grant of the Crown or State to a private in- dividual or corporation of an exclusive right to carry on a certain class of business or traffic. ' In a general and more modern sense it signifies such control of a given class of articles or of the traffic in them as will make it possible to raise their price higher than the level of prices fi.xed by free competition. A typical example of a monopoly of the first class is the grant of a patent right, which in eflfcct gives the grantee an exclusive control over the production of and traffic in the patented article; a common example of monopolies of the second class is the exclusive control of mineral or other special products of the land by virtue of ownership of ^ land. Monopolies may be classified as public or private according as they are managed by the Government or by private individuals, associ- ations, or corporations. Private monopolies may be classified as (1) legal monopolies, resting upon a grant from the Government of exclusive privileges for manufac- ture or sale: (2) natural monopolies, which are based upon the control of a limited natural product through the ownership of land or other natural resources, or of exclusive natural facili- ties for transportation; and (3) capitalistic monopolies, which hold their power over prices by virtue of the fact that an enormous capital is required in certain industries so that an established plant always has a great advantage over a new competitor. This last form of monopoly is discussed at length in the article Tri'sts. Legal monopolies have generally been granted to private persons for some real or osteTLsible service to the commonwealth. Sometimes such a grant was made primarily for fiscal purposes. Thus the monopoly of the issue of bank notes in England, granted in the early part of the eighteenth century to the Bank of England, was a reward for the considerable services of that corporation to the national exchequer. In early times the exclusive right of sale or production of a commodity was frequently granted to in- dividuals in return for a fixed sum paid into the public treasury. The danger, however, of such monopolies lay in the fact that the probable profits were as a rule underestimated through the influence of favoritism, with the result that the sums secured by the treasurv were not com- mensurate with the vexation to the public. Too frequently these exclusive privileges were granted to Court favorites whose actual sen'ices to the commonwealth merited no such reward. Mo- nopolies by grant first acquired prominence in the reign of Klizabelh, when her frequent grants of monopolies in articles of conunou use were regarded as a great abuse and brought forth the protests of Parliament. Such articles as salt, leather, coal, soap, cards, beer, and wine were thus monopolized, and indeed there was hardly any article of common lu'cessity of which the sale was not thus restricted for the benefit of the great. The practice was continued until the statute 21, James I., c. 3, known as the Statute of Monopolies, was enacted by Parlia- ment in 1023. This statute abolished all exist- ing monopolies with certain exceptions, as patents and manufactures of war supplies and materials, and forbade the creation of monop- olies, except by grant made by authority of act of Parliament, Somewhat similar in character were the special prerogatives granted about this time to the East India and otiier trading companies. The monopoly of trade which was a characteristic of the.se companies w'as held by many to be a feature essential to their success. It may be remarked that monopolj' privileges did not" pre- vent failure on the part of the many companies which from time to time were established by Fr.ance, though they may have been a valuable adjunct to the more vigorous administration of the English and Dutch companies. The limited mono])oly for a term of years which at the present time is granted to the holders of patents and copyrights is somewhat akin in principle to those just discussed, but is justified by other considerations of public policy. It differs from them in that the objects to which such rights pertain are essentially new creation.s, and the exclusive privileges 'which they convey act as a stimulus to productions w-hich are of public benefit. While copyright aims to secure to writers a reward for" their labors, there are, in general, few restrictions upon the use of these privileges. On the other hand, the aim of patent legislation is in some countries not only to stimulate invention, but to secure the widest utilization of improved processes. The monopoly which the patent right confers cannot be used, therefore, for the "ex- clusive benefit of its possessor. Persons who fail to provide for the commercial utilization of their patents forfeit their rights. German law, for instance, provides for an annual fee for the issuing of patents which grows larger as time progresses, and under this law ineffective patents or those which are not commercially prof- itable lapse and cease to be a bar to further applications of the principle upon which they are based. The power of granting mono])olies is subject to restrictions of both the United States and the various State constitutions. The ques- tion as to how far a State may grant exclusive privileges to conduct a business depends pri- marily upon the Constitution of the State, and hence is a question of constitutional law outside the scope of this article. The Fourteenth Amend- ment of the United States Constitution, which provides that "No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States, nor shall any State deprive any person of life, liberty, or property without due process of law," is a direct limitation upon the powers of a State to grant monopolies indiscriminately. It does