firms may strive for new inventions and new intellectual property because they want to become monopolies

and earn high profits—at least for a few years until the competition catches up. In this way, monopolies may

come to exist because of competitive pressures on firms. However, once a barrier to entry is in place, a

monopoly that does not need to fear competition can just produce the same old products in the same old

way—while still ringing up a healthy rate of profit. John Hicks, who won the Nobel Prize for economics in 1972,

wrote in 1935: “The best of all monopoly profits is a quiet life.” He did not mean the comment in a

complimentary way. He meant that monopolies may bank their profits and slack off on trying to please their

customers.

When AT&T provided all of the local and long-distance phone service in the United States, along with

manufacturing most of the phone equipment, the payment plans and types of phones did not change much.
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