Imperfect competition

In modern conditions, almost everyoneThe real market will, to one degree or another, be considered monopolized, that is, a market with imperfect competition. Imperfect competition is a market on which one or another condition of pure competition is not fulfilled.

The overwhelming majority of products on mostmodern markets offer a limited number of firms that are able by virtue of their dominant position to influence the conditions for the sale of goods and, above all, the level of prices.

In total, economists distinguish four market structures: pure competition, monopolistic competition, as well as monopoly and oligopoly. The last three types are imperfect competition.

The need to study imperfect competitionis explained by the fact that a significant amount of economic activity is carried out in the conditions of monopolies. Especially this problem is relevant for the Russian economy.

Imperfect competition in the works of economists

The analysis of competition is devoted to a large numberworks of various economists. Adam Smith, for example, proposed the concept of "free competition", which became the prototype of perfect competition. In Smith's works, imperfect competition appeared in the form of monopolies.

Joan Robinson returns to the statisticalanalysis of imperfect and perfect competition. She in her works justifies the relationship between monopoly price, price elasticity of demand and marginal costs.

However, many problems, including imperfect competition in the conditions of global globalization, remain little researched at present.

Imperfect competition: the essence and content

Competition is an integral part of the marketeconomy. Thanks to the market, there is coordination of the plans of consumers and producers, more efficient use of resources, redistribution of income in accordance with the results of activities.

But this is possible only when the producers of goods compete, compete with each other.

All forms and types of competition are reduced to two basic: perfect and imperfect. Perfect competition is a model of the market that meets a number of conditions:

· A large number of buyers and sellers.

Absolute transparency of the market.

· The inability of individual market actors to influence the behavior of others.

· Uniformity of goods sold.

· Mobility of all factors of production.

· Absence of subjective control by individual producers over prices.

The modern market is a market with imperfect competition. Competition becomes such when at least one sign of perfect competition is violated.

The degree of monopoly or imperfection of competition can be different.

The first stage is monopolistic competition,in which there are many firms on the market, but each of them has some part of monopoly power, conditioned by the differentiation of product quality. An example is imperfect competition in the labor market, when each candidate has his own skills, characteristics that distinguish him from all others.

The next step is the oligopoly, when several large firms have a predominant position in the market. In this case, the action of one firm will lead to the response of all other firms.

The highest degree of imperfection of competition is a pure monopoly. In this situation, only one firm operates in the industry. For example, the only airport, the only railway in the city.

Thus, it can be concluded that imperfect competition is the form of existence of virtually all real markets.