Monopolistic competitors? What is the connection between monopolistic and perfectly competitive firm

3.In the long term, monopolistic competitors can not only adjust the scale of production, but also join or withdraw from production groups. This means that the profit of the monopolistic competitor in the long-run equilibrium must be zero, that is, at the long-run equilibrium point of the monopolistic competitor, the D demand curve must be tangent to the LAC curve, that is, there is p=ar=lac.

4.Three characteristics: (1) There are a large number of enterprises in the production group that produce different products of the same kind, and these products are very close to each other's substitutes.

2) The number of enterprises in a production group is so large that each manufacturer believes that its actions will have little impact and will not attract the attention and reaction of competitors, and therefore will not be affected by any retaliatory measures by competitors.

3) The production scale of the manufacturer is relatively small, therefore, it is easier to enter and exit a production group.

On the one hand, because there are differences in each product in the market, each manufacturer has a certain monopoly on its own products, and the greater the difference, the higher the monopoly; On the other hand, each product will encounter a large amount of competition from other similar products, and there will be a competitive component in the market.

How easy it is to enter the market.

Is it a recipient or a formulator.

Perfect competition is an idealized assumption, which is basically non-existent in reality, even if there are many buyers and buyers in the market like agricultural products, but there is still a minimum limit! You can't come up with one or two companies to analyze this question because it doesn't represent a market.

It is difficult to enter the market of monopoly competition, and it is difficult to master the core technology (the most important thing is this, you will understand by listing a few industries: automotive, software, computer hardware).In addition to the fierce market struggle, the macro policy of the first can be said to be a decisive factor, such as China's large enterprises are basically saved by the administrative power of the first (Sinopec, PetroChina, mobile, telecommunications.

There is a similar situation in South Korea, where several large companies (Hyundai, Samsung, LG....It can be said that it controls more than 80% of the country's economy, and the output of Samsung, which I saw the other day, accounts for 25% of South Korea's GDP, and that's it!

The key difference is whether there is anyone competing with him!

Monopoly means that there is no one to compete with him!

The key factor that determines the monopoly is two words: technology!

The market is the product of social division of labor and commodity production, there is social division of labor and commodity exchange, and the main three elements that determine the size and capacity of the market are buyers, purchasing power, and desire to buy. There are four types of markets: perfect competition oligopoly, monopolistic competition, and complete monopoly market.

A perfectly competitive market, also known as a pure competitive market or a free competitive market, usually refers to a very large number of production and sales enterprises in an industry, and they all provide the same and standardized product market to the market in the same way. Whether it is the quality, performance, shape, packaging and other aspects of the product is not particularly different, no enterprise can open a huge difference between its own products and other people's products to form a monopoly, so as to obtain monopoly profits. There are also a large number of consumers of such products, and the proportion of individuals is very small compared to the production and purchase of the market as a whole.

Oligopoly usually refers to the demand curve of a company in a market where the company's products are unique and the number of competitors is relatively small, and the industry is obviously inelastic. Even if a company mentions its own products, there will not be much gap in sales, and competitors may raise it.

Monopolistic competition is one of the more typical market models in economics, and it is often called a market structure that is infinitely close to perfect competition. The most important characteristic of monopolistic competition is that there are a very large number of producers and consumers in the market, and consumers have obvious preferences, although there are differences in the many commodities provided by each producer, there is no difference in essence, and it is an intermediate state between the two extreme market structures of perfect competition and complete monopoly.

A complete monopoly market refers to a market structure in which there is only one supplier and many demanders in the market. The conditions for a complete monopoly of the market are very harsh, and in reality this phenomenon is not particularly many, and the following conditions must be met. The first is that there is only one manufacturer in the market that produces and sells this commodity; The second is that there is no substitute for this product; The third is that it is extremely difficult or almost impossible for other manufacturers to make this product.

FYI.

Monopolistic competition is between perfect competition and complete monopoly Free competition: There are countless manufacturers, and any manufacturer produces the same goods, so no manufacturer can exert influence on **. Such as monopoly competition in agricultural products:

There are many manufacturers who produce different products, but there are substitutes for the goods. For example, books of all kinds are completely monopolistic: only one company produces one product, and there is no substitute for that product.

Enterprises can have full control over goods, and control is achieved by controlling output. Such as railways, munitions can also be compared from the following aspects (1).The meaning of a perfectly competitive market structure and the conditions for its formation.

In a perfectly competitive market, the situation of the demand curve d faced by a single manufacturer; Short-term equilibrium conditions and formulas of manufacturers; The profit and loss situation of the firm when it reaches the short-term equilibrium depends on the relationship between **p and the short-term average cost curve SAC at equilibrium and the impact on profits. In a loss-making state, the conditions for the manufacturer to continue production. the condition of the short-term supply curve of manufacturers under the condition of perfect competition; The state of the industry's demand curve. the meaning of long-term equilibrium in perfectly competitive industries and the equation of long-term equilibrium conditions; The meaning of the long-term supply curve of perfect competitors and the shape of the long-term supply curve of the three industries.

2）.The meaning of a complete monopoly market structure and the main conditions for its formation, and the difference between perfect competition. the shape of the demand curve faced by a complete monopoly and the difference between perfect competition; The relationship between the marginal return curve MR and the average return curve AR is also different, with a complete monopoly on MR AR and complete competition for MR AR.

In the complete monopoly market, the short-term equilibrium conditions of manufacturers and the similarities and differences between the short-term equilibrium conditions of perfect competition and those of perfect competition; The difference between the profitability of a firm and its decision when achieving equilibrium is the difference between the profitability and its decision after a perfectly competitive firm achieves equilibrium. Under the condition of complete monopoly, the difference between the supply curve, the industry demand curve and the industry supply curve of the manufacturer is different from that under the condition of perfect competition. the difference between the long-term equilibrium of a fully monopolistic industry and the long-term equilibrium of a perfectly competitive industry; the difference between the conditions of long-term equilibrium of a complete monopoly firm and the long-term equilibrium conditions of a perfectly competitive firm; The difference between a long-term supply curve with a complete monopoly and perfect competition.

Perfect competition refers to a market structure in which competition is not hindered or interfered with in any way. A complete monopoly refers to a market structure in which there is only one producer in the entire industry. Monopolistic competition refers to a market structure in which many manufacturers produce and sell similar products with differences, and there are both competitive and monopoly factors in the market.

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Monopolistic competition refers to the market phenomenon in which many manufacturers produce similar but undesirable goods. Monopolistic competition is a common feature in the old economy, and this feature is even more obvious in the era of the new economy (also known as the knowledge economy). Monopoly is a monopoly, for example, Microsoft is a monopoly, monopolistic competition is an industry in which only a few companies have an absolute advantage.

Extended information: 1. Monopolistic competition.

Monopolistic competition is one of the main forms of market, and the concept in economics is: a market structure that is infinitely close to perfect competition. The obvious characteristics of monopolistic competition are:

There are many producers and consumers in the market, and consumers have obvious preferences, and goods and services are "not homogeneous";

Entry and exit of the market are completely free;

There are differences in the many commodities offered by producers, but there is no essential difference. It is the most common form of existence in real life.

2. Meaning. Definition of monopolistic competition: refers to the fact that there are many manufacturers selling similar but not identical products in the market.

Definition of monopolistic competitive market: refers to a market organization in which many manufacturers produce and sell the same product differently in a market. Enterprise monopolistic competition refers to the market phenomenon that many manufacturers produce similar but undesirable goods.

3. Features. 1. Monopolistic competition is a common feature in the old economy, and this feature is more obvious in the era of the new economy (also known as knowledge economy).

2. Monopolistic competition is one of the more typical forms of market in economics.

3. Enterprises that engage in monopolistic competition have a monopolistic nature in the short term, and have zero profits and overproduction in the long term.

4. It is worth noting that although monopolistic competition has always been a topic of market and competition in microeconomics, it has been increasingly used by macroeconomists, especially in the modeling trend of focusing on micro foundations after the 70s of the 20th century.

Fourth, perfect competition.

Monopolistic competition is a concept opposite to perfect competition, and is a general term for various behaviors that exclude and restrict perfect competition. It and unfair competition belong to the same scope of adjustment of the Competition Law, but there are essential differences between the two: unfair competition does not restrict or exclude perfect competition, it is the use of unfair and illegal means to engage in business activities on the premise of recognizing and allowing other competitors to participate in perfect competition; The essence of monopoly is to fundamentally exclude and restrict perfect competition, and there is no compatibility with perfect competition.

Legal Analysis: The most fundamental difference between perfect competition and monopolistic competition is whether the participants in the market have the ability to influence. Under perfect competition, neither individual consumers nor producers have the ability to influence, and the opposite is true for monopolistic competitive markets.

Legal basis: Anti-Monopoly Law of the People's Republic of China

Article 3 The monopolistic acts provided for in this Law include:

1) The undertakings reach a monopoly agreement;

2) Abuse of a dominant market position by a business operator;

3) A concentration of undertakings that has or may have the effect of eliminating or restricting competition.

Article 4: The State formulates and implements competition rules that are compatible with the socialist market economy, improves macroeconomic regulation and control, and completes unification.

1. An open, competitive and orderly market system.

Article 5 Business operators may, through fair competition and voluntary association, carry out concentration in accordance with law, expand the scale of operations, and enhance market competitiveness.

Article 6: Business operators with a dominant market position must not abuse their dominant market position to eliminate or restrict competition.

Competition and monopoly are two seemingly opposite, but complementary phenomena. So what is competition? What is a monopoly? How do you think about competition and monopoly? How do you unify the two?

Regarding the above questions, I have the following thoughts and feelings:

Every market player will face competition, and every organism will face competition. Darwin's Theory of Biological Evolution.

Think: Natural selection. The evolution of organisms comes from competition, and competition is the driving force of biological evolution.

Introduce this kind of competition into the commercial society, each market subject develops in the competition, is eliminated in the competition, and the final one that remains must be the strong one who can adapt to market changes. Therefore, competition is conducive to the development of affairs.

When a company monopolizes the market share, it is difficult for the company to have the motivation to improve, and at the same time, it will also suppress other competitors, which is not conducive to the sustainable development of the market.

As a result, it hinders the vitality of market innovation and affects the development momentum of small enterprises.

In a resource-based market, monopoly is dangerous and can hinder the development of innovative enterprises.

For example, the domestic petroleum and petrochemical industry is currently PetroChina and Sinopec.

CNOOC and other state-owned enterprises monopolize foreign oil prices, but they do not reduce prices; When the price of foreign oil is **, they will increase the price. This monopoly has affected the innovation of the entire petroleum and petrochemical industry, and the reason why this is the case is that they have no incentive to innovate and still use the old refining process, resulting in high domestic oil prices and affecting the lives of our people.

Let's start by explaining what a dynamic society is. To put it simply: a piece of cake, we can make it bigger together, and then distribute it, and abandon the zero-sum game.

Thinking is a concept of creating a win-win situation.

The corresponding is the static society, that is, now there is only one piece of cake, it is so big, you distribute more, I will less, it is a zero-sum game thinking.

In a dynamic society, we can create value together, so if you are in a monopoly position in a certain sub-industry, but it still does not affect the creation of more value in the industry, it is not necessarily a bad thing for users. The best case: Alipay, WeChat, they are their monopoly positions in their respective payment fields and social fields, but they still create greater value to serve, and for users, they do not feel that their interests are damaged.

Competition is still the most basic operating rule of the market, which must be observed.

For the dynamic society, as entrepreneurs, we should strive to become a monopolist in a certain subdivided industry, so as to make ourselves more competitive, so as to occupy a place in the subdivided industry, create greater value, and continue to make the cake bigger, rather than sticking to the original market share.

Competition and monopoly, there is no absolute good and bad, Zizao follow the basic law, make the market bigger, benefit more users, create greater value, and promote the continuous development of society, this is what we want to pursue!