Why Is Monopolies Harmful and How Can Regulation Ameliorate These Harmful Effects? Why is monopoly ‘harmful? How can regulation ameliorate these harmful effects? What problems confront the regulators? In order to deduce that a monopoly is ‘harmful', there must be another market system which is preferable to monopoly so as to offer greater benefits to the public. A monopoly can therefore be compared to perfect competition. If the benefits of perfect competition outweigh the benefits of monopoly then a monopoly can be regarded as ‘harmful' since the consumers are not receiving the maximum possible utility for their purchases. Monop