A situation in which a single company or group owns all or nearly all of the market for a given type of product or service. By definition, monopoly is characterized by an absence of competition, which often results in high prices and inferior products.

Some firms get monopoly power because the law prevents others from entering the market. An example of a legal barrier to entry is a patent. For example, the manufacturer of Clarinex is the only firm that can produce and sell this drug. On the other hand, some firms get their monopoly power by attaining such a huge size that competing against them is impossible. An example of this type of monopoly is Microsoft's near-exclusive corner on the sale of PC-based operating systems.