tion—and the benefits to consumers that are the consequences of competition—are eliminated.19 Here, according to Kirzner, the monopolist is completely "immune from the competition of other entrepreneurs who might, in other circumstances, enter his field of activity."20
Kirzner is quick to note, however, that the monopolist is not immune from the competitive process itself. Although entry into some specific activity is by definition blockaded, entry into similar activities is not. Monopoly control over a resource simply diverts the competitive, entrepreneurial process into other similar activities, employing other resources which create a "turbulence" that surrounds and impinges upon the monopolist's, original activity.
Importantly, Kirzner hints that the equilibrium tendency of a market containing resource monopoly is to produce a higher than "competitive-equilibrium price" for the resources and also a higher "surplus" for the product produced with that resource. This surplus can be accomplished by withdrawing some of the stock from the market and "forcing" up the market price.21 Thus, consumers might be harmed by such activity since scarce monopolized resources are not being employed to the "fullest extent compatible with the pattern of consumer tastes in the market."22
ROTHBARD'S MONOPOLY THEORY
Professor Rothbard's analysis of monopoly, monopoly price, and the welfare implications of such economic conditions differs radically from that of both Mises and Kirzner. Indeed, in his discussion of monopoly, Rothbard is sharply critical not only of the neoclassical monopoly theories, but also implicitly critical (and occasionally explicitly critical) of views held by his fellow Austrian theorists as well.23
As far as Rothbard is concerned, there are three possible definitions of monopoly: one, the single seller of any given good; two, a grant of special privilege by the state, reserving a certain area of production to one particular individual or group; and three, "a person who has achieved a monopoly price."24
Although Rothbard admits that the first definition (single seller) is a coherent and even a "legitimate" one, he rejects it as impractical because it is too broad and all-inclusive. The impractical nature of this definition can be illustrated, Rothbard argues, by noting that any difference (differentiation) in any two goods or resources and, more importantly, any consumer-perceived difference in any two commodities or resources will make them unique (specific) goods and thus, by definition, "monopoly." Hence, "the single seller of any given good" could always reduce to the notion that everyone is a monopolist since each person in a market system is presumed to have exclusive ownership of his own (unique) property. But a definition that makes everything monopoly and everyone a monopolist is barren, "confusing," and "absurd" according to Rothbard.25
Rothbard clearly prefers the second definition of monopoly—i.e., a grant of privilege from the state restricting competitive production or sale. This is a monopoly since entry into the privileged activity is prohibited by the state; logically, no such monopoly could ever exist in a free market. This definition will be adopted as the "proper" one should the final alternative definition prove nonsensical or illegitimate.26
Rothbard's criticism of the theory of "monopoly price" (as well as his criticism of the theory of "competitive price") is certainly a controversial contribution to the literature on monopoly. For here he argues that in a free market there is simply no way of conceptually distinguishing "monopoly price" from a free-market competitive price.
On the free market there is no way of distinguishing a "monopoly price" or a "subcompetitive price" or of establishing any changes as movements from one to the other. No criteria can be found for making such distinctions. The concept of monopoly price as distinguished from competitive price is therefore untenable. We can speak only of the free market price.27
It has been common, of course, to speak of monopoly price as that