The Four Market Structures - Oligopoly

Oligopoly

Oligopoly, another market structure that i want to share with you all.

There are a few large firms in this market. The number of firms are so small that each must consider the reaction of the rivals in formulating it price policy.

They are mutually interdependent. If a firms charge a higher price, the other party will be affected. The firms will engage in strategic behavior, they normally will control on their pricing.

The product that they produce is homogeneous and it is differentiated products.

Industries which are examples of oligopolies include:

• ·         Automobile
• ·         Oil industries
• ·         Telecommunication
• ·         Electronic Products

 I took Android and iOS as example for oligopoly.

Both of the mobile operate system are the most powerful being in the smart phone market. Both of the mobile operate system occupied over 80% of the smart phone market. They sell identical product. They are also the price maker in this market. 


Resources: http://www.investopedia.com/terms/o/oligopoly.asp
                  http://examples.yourdictionary.com/oligopoly-examples.html