Essay on Monopolistic Competition - Economics Discussion.
Monopolistic competition means markets that characterized by many buyers and sellers trying to make their products look difference from other competitors like the morning and night market. Oligopoly means industry characterized by a handful of sellers with the power to influence the prices of their products like the industries who sell the branded products in shopping complex.
Monopolistic competition is a form of imperfect competition and can be found in many real world markets ranging from clusters of sandwich bars, other fast food shops and coffee stores in a busy town centre to pizza delivery businesses in a city or hairdressers in a local area.
Monopolistic Competition Market Structure The four key characteristics of monopolistic competition are large number of small firms, similar but not identical products sold by the firms, i. e. differentiated products, relative freedom of entry and exit out of the industry and extensive knowledge of prices and technology (McConnell and Brue, 2004, p. 461).
In Monopolistic Competition, there are many companies selling similar but not identical products. Put differently, the goods are close, but not perfect substitutes. Because of the relative ease of substitution, companies often compete by advertising, services (for stores), brand names, brand loyalty and product differentiation more than by price.
Monopolistic competitionThe model of monopolistic competition describes a common market structure in which firms have many competitors, but each one sells a slightly different product.Monopolistic competition as amarket structure was first identified in the 1930s by American.
In a monopolistic competition market, each company has a small market share (as opposed to pure monopoly, where the dominant firm has a large market share). Because differentiation of products is needed, marketing plays an important role in setting products apart in the buyers' minds.
Chapter 10. Monopolistic Competition and Oligopoly. Introduction to Monopolistic Competition and Oligopoly; 10.1 Monopolistic Competition; 10.2 Oligopoly; Chapter 11. Monopoly and Antitrust Policy. Introduction to Monopoly and Antitrust Policy; 11.1 Corporate Mergers; 11.2 Regulating Anticompetitive Behavior; 11.3 Regulating Natural Monopolies.