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Government

Governmental actions and influence on commerce

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Governmental actions and influence on commerce

The monetary impacts and societal dangers of monopolistic businesses are many. In order to fight the impacts laid by the monopolistic giants, the governments have turned to legislation as well as court cases and bring these organizations under control. Despite the fact that the procedures implemented by the US have been into action after the shift, the grounds to curb the authority in the market are consistent. While the cases of government efforts can more or less be regarded as boundless, there are two specific examples that stand out of the rest – 19th-century railways and Microsoft.

19th-century railway and government interventions

As can be seen from the initial history of the US, most of the control revolved with the railroad business as its axis. The responsibility of controlling the open enterprises was initially assigned to the individual states. However, the inadequacy of the passed legislation, along with the powerlessness in controlling the railroad monopolies, clearly defined the necessity of government guidance agonizing. The first interstate admin council was formed by the 1887 section of the Interstate Commerce Act (Brown, 2013). However, this group was not successful in terms of controlling the prevalent railroad practices, and the reference point for governmental control was set. The following legislative actions, such as the Sherman and Clayton Anti-Trust Act, came in with a noticeable impact on the major organizations. Another bill passed by the government, the Government Exchange Commission, has brought in more impact. It is a significant source of administrative collection from the monopolies on the date.

Creating opportunities for small businesses

On the date, more than 60% of the national economy in the US is driven by the small and mid-sized business enterprises. In case the giants continue to hold firm control over their respective industries in the market, there is hardly any chance for small businesses to thrive in the competition (Joskow, 2007). As for example, the domination of Microsoft has recently fetched in an issue in its name for its practices to be tagged as monopolistic. Its package of software makes it hard for any of the other software developers new in the market to gain customers. Be it the media player, photo viewer, or any other basic essentials – Microsoft provides an all-round package, and the users do not need to turn to anybody else for anything. This extensive control of the enterprise in almost all of the industry sectors provides substantial social weight for the government to interfere with. Truth be told, the government has never made an attempt of smothering an organization due to its stable existence. Instead, the governmental interventions come in to cut down the rivalry and create chances for the new organizations to establish themselves in the market.

 

 

Reference

Brown, J. H. (2013). The ‘railroad problem’and the interstate commerce act. Review of Industrial Organization43(1-2), 7-19.

Joskow, P. L. (2007). Regulation of natural monopoly. Handbook of law and economics2, 1227-1348.

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