The Term “Oligopoly” has been derived from two Greek words.
Sources of Oligopoly
Huge capital investment
Economies of scale.
Patent rights
Control over certain raw materials
Merger and takeover.
Characteristics Of Oligopoly
Various forms of oligopoly
Oligopoly models
The Term “Oligopoly” has been derived from two Greek words.
Sources of Oligopoly
Huge capital investment
Economies of scale.
Patent rights
Control over certain raw materials
Merger and takeover.
Characteristics Of Oligopoly
Various forms of oligopoly
Oligopoly models
Models of Oligopoly
Cournot’s duopoly model
Sweezy’s kinked demand curve model
Price leadership models
Collusive models :The Cartel Arrangement
The Game Theory
Prisoner’s Dilemma
Price leadership Model
Collusive models The Cartel Arrangement
The Contents Are:
Monopoly
Perfect Competition
Imperfect Competition
Oligopoly
Monopolistic Competition:
Characteristics Of Monopolistic Competition
Monopolistic Competitive Firm Earing Profit In Short Run
Monopolistic Competitive Firm Losses In Short Run
Monopolistic Competition In Long Run
Monopolistic Competition And The Welfare Of Society
Advertising
The Critique Of Advertising
The Defence Of Advertising
Monopolistic Competition
Definition: Monopolistic competition is the market structure where a large number of firms that produce differentiated products which are close substitutes for each other.
In other words, large sellers selling the products that are similar, but not identical and compete with each other on other factors besides price
The monopolistic competition combines elements of both monopoly and competition. Since each firm sells a differentiated product, it has some control over the price at which it sells its output.
Students should be able to:
Use simple game theory to illustrate the interdependence that exists in oligopolistic markets
Understanding the prisoners’ dilemma and a simple two firm/two outcome model. Students should analyse the advantages/disadvantages of being a first mover
Students will not be expected to have an understanding of the Nash Equilibrium
Models of Oligopoly
Cournot’s duopoly model
Sweezy’s kinked demand curve model
Price leadership models
Collusive models :The Cartel Arrangement
The Game Theory
Prisoner’s Dilemma
Price leadership Model
Collusive models The Cartel Arrangement
The Contents Are:
Monopoly
Perfect Competition
Imperfect Competition
Oligopoly
Monopolistic Competition:
Characteristics Of Monopolistic Competition
Monopolistic Competitive Firm Earing Profit In Short Run
Monopolistic Competitive Firm Losses In Short Run
Monopolistic Competition In Long Run
Monopolistic Competition And The Welfare Of Society
Advertising
The Critique Of Advertising
The Defence Of Advertising
Monopolistic Competition
Definition: Monopolistic competition is the market structure where a large number of firms that produce differentiated products which are close substitutes for each other.
In other words, large sellers selling the products that are similar, but not identical and compete with each other on other factors besides price
The monopolistic competition combines elements of both monopoly and competition. Since each firm sells a differentiated product, it has some control over the price at which it sells its output.
Students should be able to:
Use simple game theory to illustrate the interdependence that exists in oligopolistic markets
Understanding the prisoners’ dilemma and a simple two firm/two outcome model. Students should analyse the advantages/disadvantages of being a first mover
Students will not be expected to have an understanding of the Nash Equilibrium
RESEARCH DESIGN , Sampling Designs , Dependent and Independent Variables, Extraneous Variables, Hypothesis, Exploratory Research Design, Descriptive and Diagnostic Research
Macro Economics
For downloading this contact- bikashkumar.bk100@gmail.com
Prepared by Students of University of Rajshahi
Tanvir Ahmed
Md Mamun Islam
Md Shahidul Islam
Anjon Mojumder
Sadia Afrin
Here this is my first exprience.this slides all around the market.
A market structure characterized by a single seller, selling a unique product in the market. In a monopoly market, the seller faces no competition, as he is the sole seller of goods with no close substitute.
1. The Term “Oligopoly” has been derived from two Greek
words.
‘Oligi’ which means few and ‘Polien’ means sellers.
Thus Oligopoly is an abridged version of monopolistic
competition . It is a competition among few big sellers each
one of them selling either homogenous or heterogeneous
products.
Introduction
2. Oligopoly refers to a market situation where there are a few
sellers in a market, selling homogenous or differentiated
products. Oligopoly is often described as ‘Competition
among few’.
When the products of a few sellers are homogenous it is
known as ‘Pure Oligopoly’ When the products of few
sellers are differentiated , but close substitutes of each other
it is known as “Differentiated Oligopoly” .
Definition Of Oligopoly:
3. Sources of Oligopoly
Factors that give rise to oligopoly are :
• Huge capital investment
• Economies of scale.
• Patent rights
• Control over certain raw materials
• Merger and takeover.
4. 1. Few Sellers : An oligopoly market is characterized by a few
sellers and their number is limited . Oligopoly is a
special type of imperfect market. It has a large number
of buyers but a few sellers.
2. Homogeneous or Differentiated Product : The Oligopolists
produce either homogenous or differentiated products.
Products may be differentiated by way of design ,
trademark or service
Characteristics Of Oligopoly:
5. 3. Interdependence : The most important feature of the Oligopoly
is the interdependence in decision making of the few firms
which comprise the industry.
The reactions of the rival firms may be difficult to guess. Hence
price is indeterminate under Oligopoly.
4. High Cross Elasticities : The cross elasticity of demand for the
products of oligopoly firms is very high. Hence there is
always the fear of retaliation by rivals.
Each firm is conscious about the possible action and reaction of
competitors while making any change in price or output
6. 5. Importance of Advertising and Selling costs : Oligopolistic
firms have to employ various aggressive and defensive
marketing weapons to gain greater share in the market or to
maintain their share.
Hence, the firms incur a good deal of costs on advertising and
other measures or sales promotion .
Firms in Oligopoly market avoid price cutting and try to compete
on non-price basis. This is because if they start under-cutting
one another, a type of price war will emerge which will drive a
few of them out of the market .
6. Competition : Competition is unique in an oligopoly market. It
is a constant struggle against rivals.
7. 7. Group Behaviour : Each Oligopolist closely watches the
business behavior of other Oligopolists in the industry and
designs his moves on the basis of some assumptions of their
behavior .
8. Uncertainty : The interdependence of other firms for one’s own
decision creates an atmosphere of uncertainty about price and
output
9. Price Rigidity : In an oligopoly market each firm sticks to its
own price to avoid a possible price war. The price remains
rigid because of constant fear of retaliation from rivals.
8. Various forms of oligopoly
1. Perfect and Imperfect Oligopolies : If the product of the rival firm are
homogenous then it is Perfect Oligopoly, if the product are differentiated
it is Imperfect Oligopoly.
2. Open and Closed Oligopolies : If entry is open to new firms it is termed
as Open Oligopoly, and if entry is strictly restricted it is termed as
Closed Oligopoly.
3. Collusive Oligopoly : If the firms under oligopoly market combine
together instead of competing it is known as Collusive Oligopoly. The
collusive may take place in the form of a common agreement or an
understanding between the firms.
4. Partial and Full Oligopoly : Partial oligopoly is formed when the
dominant firm which is the price leader and all other firms follow the
price of the price leader. If no firm acts as a price leader then it is called
Full Oligopoly.