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Perfect Competition
We have a lot of different market structures. The spectrum of competition ranges from perfectly competitive markets where there are many sellers who are price takers to a pure monopoly where one single supplier dominates an industry and sets price(monopolistic competition, oligopoly, monopsony, oligopsony, monopoly, natural monopoly, and perfect competition). I will try to find advantages and disadvantages in market structure called perfect competition.
Perfect competition is a theoretical market structure. It is primarily used as a benchmark against which other market structures are compared. This structure sometimes referred to as “pure competition”. Perfect competition describes a market structure whose assumptions are extremely strong and highly unlikely to exist in most real-time and real-world markets. The reality is that most markets are imperfectly competitive. Nonetheless, there is some value in understanding how price, output and equilibrium is established in both the short and the long run in a market that holds true to the tough assumptions of a world of perfect competition.…
Some believe that one of the prime examples of a perfectly competitive market anywhere in the world is street food in developing countries. This is so since relatively few barriers to entry/exit exist for street vendors. Furthermore, there are often numerous buyers and sellers of a given street food, in addition to consumers/sellers possessing perfect information of the product in question. It is often the case that street vendors may serve a homogenous product, in which little to no variations in the product's nature exist. In conclusion, I can say that very few markets or industries in the real world are perfectly competitive. Ofcorse there are people who say that there is no actual perfect competetive market in the real world, but then we can say that we were found markets which are the most closest to perfect competetive market. In my opinion it is possible.
