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Monopolies and oligopolies - Coursework Example

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offers a clear insight in the concern over Antitrust investigation. In this case, the European commission a concern in the manner at which he company was using its market power in…
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Monopolies and oligopolies
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Download file to see previous pages In engaging in such an action, Google as company put other players at a fix. In other words, due to the unhealthy competition, firms in the European Economic Area (EEA) suffered both peculiar and non-peculiar cost. Through analysis, whenever there is a genuine complaint antitrust, it is linked with the dollar figure sense, and for the case of Google, it was worse since it was related to fix pricing.
The world has become very dynamic and competitive and thus it is evident that monopolies are not good for any society. For instance the society is more often than not failing to benefit from the single player. Decline in consumer surplus, less incentives, higher consumer prices are a common trend in an industry dominated by monopolies. Sadly, the firms in these industries benefit from the market power behind a monopoly since they can obtain more economic profit by having prices at higher possible point. These firms likewise use the economic profits from the monopoly acts to invest in development and research with resources for the company and thus hugely benefit given the diseconomies of sale.
On the other hand, Oligopoly’s case is much unique since the industry has few but large firms. In this regard, if they interfere with price setting it may be a great disadvantage of the final consumer. With no competition or just little competition within the market, these few firms may not have the will to expand or improve their production to benefit their consumers. While having little to new competition in the market can be a bad thing it can also be an advantage for them as they can make huge profits. In cases where prices are easily comparable, it forces firms to set their market prices competitively which are beneficial for the consumers.
Antitrust investigation normally implies all the inquiry carried out with a view to obtain the involvement of their business in any illegal business act ...Download file to see next pagesRead More
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