Businesses that function either as chartered monopolies or as licensed sellers (oligopolies) are already operating in an environment where competition is at least partially restricted. Therefore, if they wish to maximize their monetary profits, they will seek to consolidate that control, and regulatory requirements are often useful to that end. Although regulation imposes a burden of compliance on the regulated businesses, even that cost tends to protect the firms that are well established in their markets from smaller "upstart" competitors. Much or most of that burden is typically in the form of fixed costs, such as paperwork, tax accounting (cf. p. 4.11:101), and license fees—in short, costs that are virtually the same for small and large businesses. Consequently, even regulations that do not on the surface appear aimed to restrict competition are often especially onerous to small businesses and offer a decisive marginal advantage to the largest companies in a given market—so that such regulation is in fact anti-competitive. Even businesses that are not presently chartered or licensed but which operate within a regulated industry may discern some monetary advantage in using the existing interventionist apparatus to restrict new competitors, e. g., through regulations that include "grandfather" clauses. The causal tendencies just described are highlighted in red on the graph; scroll as needed.      Next page
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