Q6

====To land, the external costs in a competitive industry will often be pollution, seeing that the firm will strive hard to diminish their costs resulting in the firm ignoring 'unnecessary' costs. The monopoly owned by the government, would never be able to ignore such a serious matter, and they would have to pay the costs. A monopoly would also have to be careful not to damage its image, seeing that is, in many cases, already is unpopular. Capital, on the other hand, is often to the benefit of a monopoly, since they produce at a large scale. To fully utilize capital, a lot of labour is needed, labour which a monopoly is expected to have, and a smaller competitive firm may lack. For example, a blast furnace might need a crew of 24 men working night and day, to fully utilize it. The monopolizing company may be able to provide the men, but the smaller firm might not have the money to hire all the 24 men at night, seeing wages are much higher at then. The question then is if the competitive company is so much more efficient due to hard work, that they still can produce more than the monopoly. When it comes to labour, it is obvious that a competitive industry will strive to utilize the workers at a maximum level, due to the desire of minimizing costs, and workers will in general be very efficient due the reasons mentioned above. The workers in a monopoly, often loose the feeling, that their work makes a difference in the firm, making it hard for managers to fully utilize the them.====