/ Perfect competition. Examples of perfect competition

Perfect competition. Examples of perfect competition

Improve production, reduce costson production, automation of all processes, optimization of the structure of enterprises - all this is an important condition for the development of modern business. What is the best way to make enterprises do all of this? Only the market.

Under the market is understood that competition, whichoccurs between enterprises that produce or sell similar products. If there is a high level of healthy competition, then for the existence of such a market, it is necessary to constantly improve the quality of the goods and reduce the level of common costs.

The concept of perfect competition

Perfect competition, examples of whichare given in the article, is the complete opposite of the monopoly. That is, it is a market in which there is an unlimited number of sellers who are engaged in the same or similar goods and can not influence its price at the same time.

At the same time, the state should not influence the marketor to engage in its full regulation, since this can affect the number of sellers, as well as the volume of products on the market, which is immediately reflected in the price for one unit of the product.

perfect competition examples

Despite, it would seem, ideal conditions forconducting business, many experts are inclined to the fact that in real conditions on the market for a long time there can not be perfect competition. Examples, which confirm their words, have happened many times in history. In the end result, the market became either an oligopoly, or some other form of imperfect competition.

Perfect competition can lead to a decline

This is due to the fact that in the long runthe price is constantly decreasing. And if the human resource in the world is big, then the technological one is very limited. And sooner or later the enterprises will move to the fact that all fixed assets and all production processes will be modernized, and the price will still fall because of attempts of competitors to win a larger market.

market of perfect competition examples

And this will lead to the functioning on the verge of a break-even point or under it. Save the situation can already be only influence outside the market.

The main features of perfect competition

We can distinguish the following features that a market of perfect competition should have:

- a large number of sellers or manufacturers of products. That is, all the demand that is on the market should be covered not by one or several enterprises, as in the case of monopoly and oligopoly;

- products in such a market should be eitherhomogeneous, or interchangeable. It is understood that sellers or manufacturers produce such goods, which can be completely replaced by the products of other market participants;

- prices are set only by market anddepend on supply and demand. Pricing should not be affected either by the state, or by specific sellers or producers. The price of the goods must determine the cost of production, the level of demand, as well as supply;

- there should be no barriers to exit orentry to the market of perfect competition. Examples can be very different from the sphere of small business, where special requirements are not created and special licenses are not needed: atelier, shoe repair services, etc .;

- there should be no other effects on the market from the outside.

Perfect competition is extremely rare

In the real world can not give examples of firmsperfect competition, since there is simply no market that operates under such rules. There are segments that are as close as possible to its conditions.

perfect competition in russia examples

To find such examples, it is necessary to find thoseThe markets on which the small business basically functions. If the market where it functions, you can enter any company, and it's easy to get out of it, then this is a sign of such competition.

Examples of perfect and imperfect competition

If we talk about imperfect competition, thenIts bright representative is the monopoly markets. Enterprises that function in such conditions have no incentive to develop and improve.

In addition, they produce such goods andprovide services that can not be replaced by any other products. This explains the poorly controlled level of prices, established by non-market way. An example of such a market can be called a whole sector of the economy - the oil and gas industry, and the monopoly company is Gazprom.

An example of a market for perfect competition issphere of rendering of services in repair of cars. There are a lot of different SRTs and auto repair shops both in the city and in other settlements. The type and number of works performed are practically the same everywhere.

examples of firms with perfect competition

It is impossible to increase artificially in the legal fieldprices for goods, if the market is in perfect competition. Examples that confirm this statement, everyone has seen in their lives repeatedly in the ordinary market. If one vegetable seller raised the price of tomatoes by 10 rubles, while the quality of them is the same as that of competitors, then buyers will stop buying from him.

If monopolist can influence the price by monopoly by increasing or decreasing supply, then in this case such methods are not suitable.

With perfect competition, you can not raise the price yourself, as a monopoly enterprise can do

Because of the large number of competitors simplyit is impossible to raise the price, since all customers will simply switch to purchasing the corresponding goods from other enterprises. Thus, an enterprise may lose its market share, which will entail irreversible consequences.

In addition, in such markets, there is a decline in commodity prices by individual sellers. This happens in an attempt to "recapture" new market shares to increase income levels.

examples of perfect and imperfect competition

And in order to reduce prices, you need lessspend raw materials and other resources on the production of one unit of products. Such changes are possible only through the introduction of new technologies, the optimization of production and other processes that can reduce the cost of doing business.

In Russia, markets that are close to perfect competition are not developing fast enough

If we talk about the domestic market, the perfectcompetition in Russia, examples of which are found in almost all spheres of small business, develops at an average pace, but could have been better. The main problem is weak support of the state, since so far many laws are aimed at supporting large producers, which are often monopolists. In the meantime, the sphere of small business remains without special attention and necessary funding.

example of a market for perfect competition is

Perfect competition, examples of whichgiven above, is an ideal form of competition from the understanding of the criteria of pricing, supply and demand. For today in any economy of the world it is impossible to find such market which would correspond to all requirements that it is necessary to observe at the perfect competition.