There are three type of Imperfect Competition:
Imperfectly Competitive often formed because there are high Barriers to Entry.
Different from firms in Perfect Competition is "Price Takers", firms in Imperfect Competition are "price makers".
| Characteristic |
Perfect Competition |
Monopolistic Competition |
Oligopoly |
Simple Monopoly (No Price Discrimination) |
Price-Discriminating Monopoly |
| Number of Firms |
Very many |
Many |
Few |
One |
One |
| Product Type |
Homogeneous |
Differentiated |
Homogeneous or Differentiated |
Unique |
Unique |
| Barriers to Entry |
None |
Low |
High |
Very high |
Very high |
| Price Control |
None (price taker) |
Some, limited |
Considerable (interdependent) |
Significant (price maker) |
Significant (multiple prices) |
| Pricing Strategy |
Single market price |
Single price (differentiated) |
Interdependent pricing |
Single price |
Different prices to different consumers/units |
| Demand Curve Faced |
Horizontal |
Downward sloping, elastic |
Downward sloping (kinked) |
Downward sloping (market) |
Downward sloping (but captures CS) |
| Long-Run Economic Profit |
Zero (normal) |
Zero (normal) |
Positive possible |
Positive possible |
Positive (often higher than simple monopoly) |
| Deadweight Loss (DWL) |
None |
Yes (some) |
Yes (significant) |
Yes (largest among non-discriminating) |
None (1st-degree) or Reduced (3rd-degree) |
| Allocative Efficiency (P = MC) |
Yes |
No (P > MC) |
Usually no (P > MC) |
No (P > MC) |
Yes (1st-degree) on last unit; partial for 3rd-degree |
| Productive Efficiency (min ATC) |
Yes |
No (excess capacity) |
Usually no |
No (inefficient scale) |
No (still produces above min ATC typically) |
| Consumer Surplus |
Maximum |
Reduced |
Reduced |
Very low |
Zero (1st-degree) or partially captured |
| Examples |
Wheat, corn |
Restaurants, salons |
Airlines, autos |
Local water utility (unregulated) |
Airline seats, student discounts, auctions |
相关笔记
Perfect Competition
Monopolistic Competition
Oligopoly
Monopoly
Price Discrimination