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An oligopoly is a market characterized by a small number of firms who realize they are interdependent
in their pricing and output policies. The number of firms is small enough to give each firm some market
power.Jan 3, 2002
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An oligopoly is a market structure in which a market or industry is dominated by a small number of large
sellers or producers. Oligopolies often result from ...
Sellers: monopoly
Buyers: monopsony
Feb 9, 2021 — The term “oligopoly” refers to an industry where there are only a small number of firms
operating. In an oligopoly, no single firm enjoys a ...
An oligopoly is a market form wherein a market or industry is dominated by a stop of large sellers.
Oligopolies can result from various forms of collusion ...
Oct 28, 2022 — An oligopoly is a market structure that involves a small group of large companies that
have all or almost all sales in the industry and ...
Oligopoly definition, the market condition that exists when there are few sellers, as a result of which
they can greatly influence price and other market ...
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Oligopoly
An oligopoly is a market structure in which a market or industry is dominated by a small number of large
sellers or producers. Oligo
OECD
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Definition:
An oligopoly is a market characterized by a small number of firms who realize they are interdependent
in their pricing and output policies. The number of firms is small enough to give each firm some market
power.
Context:
Oligopoly is distinguished from perfect competition because each firm in an oligopoly has to take into
account their interdependence; from monopolistic competition because firms have some control over
price; and from monopoly because a monopolist has no rivals. In general, the analysis of oligopoly is
concerned with the effects of mutual interdependence among firms in pricing and output decisions.
There are several types of oligopoly. When all firms are of (roughly) equal size, the oligopoly is said to be
symmetric. When this is not the case, the oligopoly is asymmetric. One typical asymmetric oligopoly is
the dominant firm. An oligopoly industry may produce goods which are homogeneous/ undifferentiated
or it may produce goods which are heterogeneous/ differentiated. The analysis of oligopoly behaviour
normally assumes a symmetric oligopoly, often a duopoly. Whether the oligopoly is differentiated or
undifferentiated, the critical problem is to determine the way in which the firms act in the face of their
realized interdependence.
In general, there are two broad approaches to this problem. The first is to assume that firms behave
cooperatively. That is, they collude in order to maximize joint monopoly profits. The second is to assume
that firms behave independently or non-cooperatively. The analysis of oligopoly behaviour under the
non-cooperative assumption forms the basis of oligopoly theory.
Within non-cooperative oligopoly theory a distinction is made between models in which firms choose
quantities and those in which they choose prices. Quantity-setting models are often referred to as
Cournet models and price-setting models as Bertrand models.
Source Publication:
Glossary of Industrial Organisation Economics and Competition Law, compiled by R. S. Khemani and D.
M. Shapiro, commissioned by the Directorate for Financial, Fiscal and Enterprise Affairs, OECD, 1993.
Cross References:
Perfect competition
Hyperlink:
http://www.oecd.org/dataoecd/8/61/2376087.pdf
polies often result from the desire to maximize profits, which can lead to collusion between companies.
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