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A monopoly is a type of market structure, which in traditional economic theory has just one firm.
It is the least competitive market structure possible. There are two definitions of a monopoly.
The economic definition is: one firm in the market with 100% of the market share. This is the definition that we use in the A-Level syllabus. A real-life example of an economist’s definition of a monopoly is: TFL, London’s only transport provider. An economist’s monopoly is also known as a pure monopoly.
The legal definition is: any firm with greater than 25% market share. These are known as legal monopolies.
Real life examples include British Gas and Tesco with 37% and 28% of their markets respectively.