Fair Business Practices: Why Do We Need It?

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The United States has an abundance of fair practices laws that intend to make things fair, yet competitive. I feel that these laws are absolutely effective in helping to balance our country. Fair practices in business protect the businesses as well as the consumers in many ways including: monopolization protection, conspiring to fix pricing or allocate customers, price gouging, and many other important protections (SBA, 2013).
In 1890 Congress passed the Sherman act with their first attempt at protecting businesses and consumers (FTC, 2008). This act was to touch down on monopolization and unreasonable trade. In order to protect consumers and businesses it was decided that monopolization; or the practice of controlling a single market, was an unfair act. Not only do monopolies have the ability to play with prices, but they can also decrease the quality of their products (Amadeo, 2013). For the consumer it could be unfortunate if, for example, the only supply of baby formula is controlled by a single company and the price increased by 40% after competition has been knocked out.
In some instances however, monopolies could be good and they are not actually illegal in the United States. A monopoly can be good if they are using their power to consistently deliver a product or service. In cases such as electric and water, where the cost is extremely high to supply them, they are controlled by the government which protects the consumer from high prices. The government controls the prices that they set and allows them to recoup and obtain a reasonable profit for their services and products (Amadeo, 2013). In this way it shows that monopolies are not illegal, but they are tightly controlled under the Sherman Anti-Trust Act.
In 1914, yet ...

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... Retrieved from http://www.ftc.gov/speeches/other/patman.shtm
Date Referenced on the web: November 15, 2013
Cornell University. (2013). Unfair competition law: an overview.
Retrieved from http://www.law.cornell.edu/wex/unfair_competition
Date Referenced on the web: November 15, 2013
Federal Trade Commission. (2008, July 08). Antitrust laws.
Retrieved from http://www.ftc.gov/bc/antitrust/antitrust_laws.shtm
Date Referenced on the web: November 15, 2013
Investopedia. (2013). Hart-scott-rodino antitrust improvements act of 1976.
Retrieved from http://www.investopedia.com/terms/h/hart-scott-rodino-antitrust- improvements-act-of-1976.asp
Date Referenced on the web: November 15, 2013
U.S. Small Business Administration. (2013).Understanding fair practice.
Retrieved from http://www.sba.gov/content/understanding-fair-practice
Date Referenced on the web: November 15, 2013

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