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Concentration Ratio
In economics, concentration ratios are used to quantify market concentration and are based on companies' market shares in a given industry. Market share can be defined as a firm's proportion of total sales in an industry, a firm's market capitalisation as a percentage of total industry market capitalisation or any other metric which conveys the size and dominance of a company relative to its competitors. A concentration ratio (CR) is the sum of the percentage market shares of (a pre-specified number of) the largest firms in an industry. An n-firm concentration ratio is a common measure of market structure and shows the combined market share of the n largest firms in the market. For example, where n = 5, CR5 defines the combined market share of the five largest firms in an industry. Competition economists and competition authorities typically employ concentration ratios (CRn) and the Herfindahl-Hirschman Index (HHI) as measures of market concentration. [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Economics
Economics () is the social science that studies the Production (economics), production, distribution (economics), distribution, and Consumption (economics), consumption of goods and services. Economics focuses on the behaviour and interactions of Agent (economics), economic agents and how economy, economies work. Microeconomics analyzes what's viewed as basic elements in the economy, including individual agents and market (economics), markets, their interactions, and the outcomes of interactions. Individual agents may include, for example, households, firms, buyers, and sellers. Macroeconomics analyzes the economy as a system where production, consumption, saving, and investment interact, and factors affecting it: employment of the resources of labour, capital, and land, currency inflation, economic growth, and public policies that have impact on glossary of economics, these elements. Other broad distinctions within economics include those between positive economics, desc ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Market Concentration
In economics, market concentration is a function of the number of firms and their respective shares of the total production (alternatively, total capacity or total reserves) in a market. In any industry, a handful of firms that hold a significant portion of the market share and likely engage in the practice of consolidation will indicate higher market concentration within that industry. The market concentration ratio measures the concentration of the top firms in the market, this can be through various metrics such as sales, employment numbers, active users or other relevant indicators. In theory and in practice, market concentration is closely associated with market competitiveness, and therefore is important to various antitrust agencies when considering proposed mergers and other regulatory issues. Market concentration is important in determining firm market power in setting prices and quantities. Market concentration is affected through various forces, including barriers ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Market Share Liability
Market share liability is a legal doctrine that allows a plaintiff to establish a prima facie case against a group of product manufacturers for an injury caused by a product, even when the plaintiff does not know from which defendant the product originated. The doctrine is unique to the law of the United States and apportions liability among the manufacturers according to their share of the market for the product giving rise to the plaintiff's injury. Origins Market share liability was introduced in the California case '' Sindell v. Abbott Laboratories''. In ''Sindell'', the plaintiffs were injured by DES, a drug prescribed to prevent miscarriage. The mothers of the plaintiffs had taken DES while pregnant, and expert testimony showed this to be a proximate cause of reproductive tract cancers in the plaintiffs years later. The plaintiffs, however, could not ascertain which drug company distributed the DES taken by their mothers. The court responded by allowing the plaintiffs ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Perfect Competition
In economics, specifically general equilibrium theory, a perfect market, also known as an atomistic market, is defined by several idealizing conditions, collectively called perfect competition, or atomistic competition. In Economic model, theoretical models where conditions of perfect competition hold, it has been demonstrated that a Market (economics), market will reach an Economic equilibrium, equilibrium in which the quantity supplied for every Goods and services, product or service, including Workforce, labor, equals the quantity demanded at the current price. This equilibrium would be a Pareto optimum. Perfect competition provides both allocative efficiency and productive efficiency: * Such markets are ''allocatively efficient'', as output will always occur where marginal cost is equal to average revenue i.e. price (MC = AR). In perfect competition, any Profit maximization, profit-maximizing producer faces a market price equal to its marginal cost (P = MC). This implies that ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Monopolistic Competition
Monopolistic competition is a type of imperfect competition such that there are many producers competing against each other, but selling products that are differentiated from one another (e.g. by branding or quality) and hence are not perfect substitutes. In monopolistic competition, a company takes the prices charged by its rivals as given and ignores the impact of its own prices on the prices of other companies. If this happens in the presence of a coercive government, monopolistic competition will fall into government-granted monopoly. Unlike perfect competition, the company maintains spare capacity. Models of monopolistic competition are often used to model industries. Textbook examples of industries with market structures similar to monopolistic competition include restaurants, cereals, clothing, shoes, and service industries in large cities. The "founding father" of the theory of monopolistic competition is Edward Hastings Chamberlin, who wrote a pioneering book on the ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Oligopoly
An oligopoly (from Greek ὀλίγος, ''oligos'' "few" and πωλεῖν, ''polein'' "to sell") is a market structure in which a market or industry is dominated by a small number of large sellers or producers. Oligopolies often result from the desire to maximize profits, which can lead to collusion between companies. This reduces competition, increases prices for consumers, and lowers wages for employees. Many industries have been cited as oligopolistic, including civil aviation, electricity providers, the telecommunications sector, Rail freight markets, food processing, funeral services, sugar refining, beer making, pulp and paper making, and automobile manufacturing. Most countries have laws outlawing anti-competitive behavior. EU competition law prohibits anti-competitive practices such as price-fixing and manipulating market supply and trade among competitors. In the US, the United States Department of Justice Antitrust Division and the Federal Trade Commission are ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Monopoly
A monopoly (from Greek language, Greek el, μόνος, mónos, single, alone, label=none and el, πωλεῖν, pōleîn, to sell, label=none), as described by Irving Fisher, is a market with the "absence of competition", creating a situation where a specific person or company, enterprise is the only supplier of a particular thing. This contrasts with a monopsony which relates to a single entity's control of a Market (economics), market to purchase a good or service, and with oligopoly and duopoly which consists of a few sellers dominating a market. Monopolies are thus characterized by a lack of economic Competition (economics), competition to produce the good (economics), good or Service (economics), service, a lack of viable substitute goods, and the possibility of a high monopoly price well above the seller's marginal cost that leads to a high monopoly profit. The verb ''monopolise'' or ''monopolize'' refers to the ''process'' by which a company gains the ability to raise ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Market Form
Market structure, in economics, depicts how firms are differentiated and categorised based on the types of goods they sell (homogeneous/heterogeneous) and how their operations are affected by external factors and elements. Market structure makes it easier to understand the characteristics of diverse markets. The main body of the market is composed of suppliers and demanders. Both parties are equal and indispensable. The market structure determines the price formation method of the market. Suppliers and Demanders (sellers and buyers) will aim to find a price that both parties can accept creating a equilibrium quantity. Market definition is an important issue for regulators facing changes in market structure, which needs to be determined. The relationship between buyers and sellers as the main body of the market includes three situations: the relationship between sellers (enterprises and enterprises), the relationship between buyers (enterprises or consumers) and the relationship be ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Microeconomics
Microeconomics is a branch of mainstream economics that studies the behavior of individuals and firms in making decisions regarding the allocation of scarce resources and the interactions among these individuals and firms. Microeconomics focuses on the study of individual markets, sectors, or industries as opposed to the national economy as whole, which is studied in macroeconomics. One goal of microeconomics is to analyze the market mechanisms that establish relative prices among goods and services and allocate limited resources among alternative uses. Microeconomics shows conditions under which free markets lead to desirable allocations. It also analyzes market failure, where markets fail to produce efficient results. While microeconomics focuses on firms and individuals, macroeconomics focuses on the sum total of economic activity, dealing with the issues of growth, inflation, and unemployment and with national policies relating to these issues. Microeconomics also deal ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Market Dominance Strategies
Market dominance describes when a firm can control markets. A dominant firm possesses the power to affect competition and influence market price. A firms' dominance is a measure of the power of a brand, product, service, or firm, relative to competitive offerings, whereby a dominant firm can behave independent of their competitors or consumers, and without concern for resource allocation. Dominant positioning is both a legal concept and an economic concept and the distinction between the two is important when determining whether a firm's market position is dominant. Sources of Market Dominance Firms can achieve dominance in their industry through multiple means, such as; * First-mover advantage, * Innovation, * Brand Equity, and * Economies of scale. First-Mover Advantages Many dominant firms are the first "important" competitor in their industry. These firms can achieve short- or long-term advantages over their competitors when they are the first offering in a new indus ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
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