Monopolistic Business Practices

Abstract

Monopolistic business practices result is a situation that, while it creates a unique set of challenges, can also be a compelling opportunity for new ventures to enter the market. This chapter aims to explore the market conditions that enable and encourage monopolistic behavior, specifically in the accounting and audit services sector. The big four auditing firms, as industry leaders, have been identified as creating monopolistic market conditions. The integrated literature review approach is used to explore the existing research on the topic. Findings indicate that there are three causes of monopolies in this sector: partner's compensation, revenue-generating purpose, and better auditing service and disclosure advice compared to other companies. The influence of the increasing prices in the audit industry and fraud are included in the work. The chapter contributes to the body of knowledge related to an understanding of how monopolies can occur, and how new ventures can seek to enter into competition with those firms.