Monopoly and oligopoly are economic market conditions. Monopoly is defined by the dominance of just one seller in the market; oligopoly is an economic situation where a number of sellers populate the market. Show
Comparison chartMonopoly versus Oligopoly comparison chart
An oligopoly of various brands (click to enlarge) CharacteristicsMonopolistic markets are controlled by one seller only. The seller here has the power to influence market prices and decisions. Consumers have limited choices and have to choose from what is supplied. The monopolist asserts all the power while the consumer is left with no choice. This market condition usually arises from mergers, take-overs and acquisitions. Oligopoly, on the other hand, is a market condition where numerous sellers co-exist in the market place. This market situation is very consumer-friendly because it induces competition amongst sellers. Competition in turn ensures moderate prices and numerous choices for consumers. A decision taken by one seller in an oligopolistic market has a direct effect on the functioning of other sellers. Sources of powerA monopolistic market derives its power through three sources: economic, legal and deliberate. A monopolistic entity will use the position it is in to its advantage and drive out competitors either by reducing prices to such an extent that survival for another seller may become impossible or by virtue of economic conditions like large capital requirement for startup companies. Legal barriers like intellectual property rights also help a monopolistic entity retain its power. Deliberate attempts for monopolistic markets would include collusion, lobbying governmental authorities etc. Though an oligopolistic market does not have any sources of power, it comes into existence solely due to the accommodating nature of other sellers. PricesA monopolistic market may quote high prices. Since there is no other competitor to fear from, the sellers will use their status of dominance and maximize their profits. Oligopoly markets on the other hand, ensure competitive hence fair prices for the consumer. Monopolistic ProductionThis video explains how monopolies reduce production and increase prices in the market. ExamplesLong Island Rail Road and Long Island Power Authority are examples of monopolistic markets. Oligopoly exists in Australia in the telecom sector (Telstra rents phone lines to other providers and they subsequently rent to customers), the grocery business(Coles and Woolworths) and media outlets (News Corporation, Time Warner and Fairfax Media). References
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us: "Monopoly vs Oligopoly." Diffen.com. Diffen LLC, n.d. Web. 2 Mar 2022. < > What are the similarities and differences between oligopoly and monopolistically competitive market?A monopoly and an oligopoly are market structures that exist when there is imperfect competition. A monopoly is when a single company produces goods with no close substitute, while an oligopoly is when a small number of relatively large companies produce similar, but slightly different goods.
How are monopolistic competition and a oligopoly similar?Answer and Explanation: Both monopoly and oligopoly competition are similar in that they portray imperfect competition and both competitive structures have price control to some extent.
What similarity between monopoly and monopolistic competition is that in both market structures?A similarity between monopoly and monopolistic competition is that, in both market structures, 1) strategic interactions among sellers are important. 2) there are a small number of sellers. 3) sellers are price makers rather than price takers.
What are the similarities between perfectly competitive and monopolistically competitive markets?(1) The number of firms is large both under perfect competition and monopolistic competition. ADVERTISEMENTS: (2) In both, firms compete with each other. (3) In both, there is freedom of entry or exit of firms.
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