A monopoly is a business with exclusive control over the sale of a particular good or service. The main cause of monopoly is barriers to entry, which can be created by government regulations, economies of scale, and patents and copyrights. Other causes of monopoly include collusion between firms and vertical integration.

Monopoly must first be defined in order to investigate its causes. Monos means "sole." Poleo means "to sell." It roughly translates as "sole seller." A monopoly is defined as any individual or firm that is the sole seller in a market. Monopolies are large corporations that exploit their customers. It is common for them to charge higher prices than a consumer would ordinarily pay in a competitive market. Therefore, they are typically carefully regulated in order to prevent unfair tactics that exploit consumers.

A monopoly arises when a single firm dominates a market, leaving no room for competition. One major cause is control over scarce resources, such as land, raw materials, or technology, which prevents others from entering the market. Government regulations, like patents or exclusive licenses, can also create monopolies by legally restricting competition. Economies of scale play a role, as larger firms can produce at lower costs, driving smaller competitors out. High barriers to entry, such as heavy startup costs, advanced technology, or strict regulations, discourage new firms. Aggressive business tactics, including predatory pricing or mergers, can further eliminate rivals. Natural monopolies also occur in industries where infrastructure costs are too high for multiple competitors, such as utilities. Together, these factors create monopolistic control.