(by Paul Dobson in the spirit of summer) This post is a reminder to all our readers to be vigilant in spotting monopoly practices on your own doorsteps. I report on my quick investigation into a potential abuse of local monopoly power. The case involves the independent Norwich toy retailer Langley’s, which has been trading since 1883 and has achieved a monopoly of specialist city centre toyshops. It is now openly boasting in its shop window that the board game Norwich Monopoly is exclusive to them, and charging £34.99, as the following photo shows:
Indeed, a search online shows that Ebay is selling the same item at the same price, …by a single seller ….Langley’s! The only apparent competition is from Amazon, where an upstart seller, “rockstrapuk”, is offering the whopping price of £74.99 + £3.99 delivery (with only 1 left in stock).
Is Langley’s abusing its monopoly position? Is steadfastly charging £34.99 an exploitative price?
As a potential comparator good, the standard (London) Monopoly set currently costs £14.49 from Amazon. Amazon are bragging that this is a special offer price, discounted from the RRP of £21.99. However, as the following pricing chart from CamelCamelCamel shows, Amazon’s price fluctuates regularly, and you could have snagged a better bargain at £9.99 last September – if you were smart enough to use a price checker service and be patient!
Is London Monopoly a good substitute for Norwich Monopoly? Probably not. Is Norwich Monopoly in a monopoly market? Probably. What would a SSNIP test reveal? Unfortunately, the lack of price fluctuation away from £34.99 and the risk of the cellophane fallacy means there is no definitive empirical evidence, but given the very limited and completely local demand for Norwich Monopoly, it could even be a natural monopoly.
One final possibility. Is Langley’s a benevolent monopolist? Is it a wonderful independent shop fighting to survive in a world dominated by multinational retail giants, and giving us a unique and special board game at a reasonable and fair price that would not otherwise exist in the market? I would like to think so and if you agree then you might want to grab a set while stocks last…!!