Monopoly

The word entered English in the 1530s from the Latin monopolium, which came from the Greek monopōlion, meaning the right of exclusive sale.1 The Greek is a compound of monos, meaning single or alone, and pōlein, meaning to sell.

The oldest surviving account of a monopoly in practice appears in Aristotle's Politics, written in the fourth century BC. Aristotle tells the story of Thales of Miletus, a philosopher mocked for his poverty. Thales used his knowledge of astronomy to predict a large olive harvest, then paid deposits on every olive press in Miletus and Chios while prices were low.2

When the harvest came and demand for presses surged, Thales held the exclusive supply. He rented them out on whatever terms he chose and made a fortune. Aristotle described the strategy as a "universal principle of business," noting that some city-states used the same technique to raise revenue.3

Aristotle called the device a monopolia. The word described a specific economic arrangement 2,300 years before antitrust law existed.

Monopolies became a subject of English law in the early seventeenth century under Queen Elizabeth I and King James I, both of whom sold monopolistic licenses to raise revenue. The resulting price increases and forced closures of unlicensed competitors led to the Statute of Monopolies in 1624, one of the earliest legal restrictions on exclusive commercial privileges.4

In 1890, the United States passed the Sherman Antitrust Act, targeting the private monopolistic corporations of the Gilded Age, including Standard Oil and Carnegie Steel. The Clayton Antitrust Act followed in 1914.5 The board game Monopoly, created in its final version by Charles Darrow and marketed by Parker Brothers in 1935, took its name from the economic concept it simulates.6