Sandalwood Factory and Silk Factory: Monopoly v. Free Market

Today we visited a government operated sandalwood factory and a silk factory. I find these two factories could be taken the formal one as a monopolistic factory and the latter one as a free market factory.

Sandalwood factory is run by the government and the government owns every sandalwood tree in the city, even if a sandalwood tree grows on one’s personal property, the government would come in and lists the tree as theirs. This is definitely a 100% pure monopoly. The government could set whatever price they want to and sell in the market.

Whereas the silk factory, although it is also a government run factory, but it faces the competition from other silk factories. The government does not have a monopoly in silk. There are many places in the world that have access to silk and I guess that’s why the security at the silk factory is stricter than the sandalwood factory. Shortly after we entered the factory, Nancy told me the truth of stricter security was that the guard at the desk wants to possess his hierarchy of power. Isn’t this sound familiar to me? Just like Chandogya Upanishad says: “Power is superior to knowledge” (33) in Being Indian book.