Short Essay on Oligopoly Market
An important case of imperfect competition is that of oligopoly. While monopolistic competition is more frequently found than pure competition in modern industry, however, it is not the typical market form. Oligopoly is the typical market form, many of the markets being oligopolistic.A large proportion of output in a modern industrial economy is accounted for by industries where all or most of the output is produced by a small number of large firms.Here, competition is much less impersonal than in monopolistic competition because the number of producers is fewer. If any firm cuts its price, the other firms will know who the price cutter was. Image Source: financialtribune.com ADVERTISEMENTS: Each firm, therefore, has to watch closely what its competitors are doing because any action by one of the competitors is…