Lesson 25: The Economic Effects of the Nineteenth-Century Monopoly

The students are introduced to the different types of business entities: the pure competitor, monopolist and cartel. They play a game that illustrates how difficult it can be for cartels or trusts to boost profits by colluding to reduce competition. The students read about the logic of monopoly prices and discuss whether workers on average were better off after industrialization. This lesson helps students understand monopolistic behavior and the conditions that gave rise to the Sherman Anti-Trust Act of 1890.

Concepts:

Cartel, Competition, Monopoly, Trusts
National Content Standards in Economics:
  • Standard #16: Role of Government and Market Failure