Difference between revisions of "Oligopoly"
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| − | An '''oligopoly''' is a seller's [[market]] having only a few sellers, who enjoy [[Barrier to entry| | + | An '''oligopoly''' is a seller's [[market]] having only a few sellers, who enjoy [[Barrier to entry|barriers to entry]] against new [[competitor]]s. An oligopoly lacks full [[competition]] and [[consumer]]s suffer as a result. |
Described another way, an oligopoly is an [[industry]] or market dominated by a only few firms selling a similar (undifferentiated) product. This is called a "perfect oligopoly." The few firms can behave in a harmful manner similar to how a [[monopoly]] behaves in overcharging customers or otherwise suppressing beneficial competition. | Described another way, an oligopoly is an [[industry]] or market dominated by a only few firms selling a similar (undifferentiated) product. This is called a "perfect oligopoly." The few firms can behave in a harmful manner similar to how a [[monopoly]] behaves in overcharging customers or otherwise suppressing beneficial competition. | ||
Revision as of 02:58, March 12, 2008
An oligopoly is a seller's market having only a few sellers, who enjoy barriers to entry against new competitors. An oligopoly lacks full competition and consumers suffer as a result.
Described another way, an oligopoly is an industry or market dominated by a only few firms selling a similar (undifferentiated) product. This is called a "perfect oligopoly." The few firms can behave in a harmful manner similar to how a monopoly behaves in overcharging customers or otherwise suppressing beneficial competition.
An imperfect oligopoly consists of a few firms in an industry or market, but their product is differentiated, as in the car industry.
An example of an oligopoly is the market for car or health insurance in most states.