Monopoly power can harm consumers from "summary" of Economic Analysis of Law by Richard A. Posner
Monopoly power can harm consumers when a firm is able to raise prices above the competitive level because it faces no effective competition. The harm to consumers stems from the fact that the higher price charged by the monopolist results in a reduction in consumer surplus. Consumer surplus is the difference between what consumers are willing to pay for a product and what they actually have to pay. When a monopolist raises prices above the competitive level, consumers lose out because they have to pay more for the product than they would in a competitive market. Furthermore, monopoly power can also harm consumers by reducing output below the competitive level. In a competitive market, firms are forced to produce at the level where marginal cost equals marginal revenue in order to maximize pro...
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