A monopsony is where there is a sole buyer of a product, but many sellers. This contrasts with the similarly named monopoly, whereby there is only one seller and many buyers.
A market structure defines the economic environment by which a business finds itself in. How much competition is there? What price pressures are there? Where is the competition pricing and pitching its products at? All such questions help us to define market structures including oligopoly, monopoly, and perfect competition.
When looking at the causes of monopoly, it is important to first define what it is. The term monopoly originates from the Ancient Greek language. Monos, meaning “sole”. And Poleo, meaning “sell”. Roughly translated, it means “Sole Seller”. Any person or business who is the only seller in the market could be classified as having a monopoly.