Abstract: Why Did the Swedish State Regard the Cement Monopoly as Beneficial?

Malin Dahlstrom

Abstract

This paper deals with the question of monopoly and the Swedish state. In 1974 the two Swedish cement producers Cementa (subsidiary to Euroc) and Gullhogen merged. Thereby a monopoly was created. The common attitude in Sweden was negative toward monopoly, and there was competition legislation that did not support monopoly. Nonetheless, the state did not interfere in the process around the merger. The question asked in the paper is: Why was the cement monopoly not a problem? Why was the monopoly regarded as beneficial? The process around the creation of the monopoly is discussed. It is found that the state and the minister of building had a central role in the creation of the monopoly; the idea of the monopoly actually came from the minister. The argument for allowing the monopoly was that the industry was of great interest for the state and that it was not desirable to have foreign ownership in the industry. The state demanded insight into the monopolist and kept control over prices. The state tried to neutralize the negative aspects of the monopoly.