Why do oligarchy exist? List five or six oligopolists whose products you own or regularly purchase. What distinguishes oilgopoly from monopolistic competition?
Are you sure you mean "oligarchy?"
This is a form of government, not a company or economic entity.
That's how the question is written in the textbook
Then the textbook is wrong.
The word is "oligopoly," not "oligarchy."
Check this site.
http://www.investopedia.com/terms/o/oligopoly.asp
Oligarchy, as you mentioned, refers to a system where a small group of individuals has significant control and power over a society or organization. Oligarchies can exist for various reasons, but some common factors include:
1. Concentration of wealth and resources: Oligarchies often arise when a small group accumulates a disproportionate amount of wealth, giving them the means to exert control and influence over others.
2. Power dynamics and influence: Oligarchies can form when individuals or groups gain influence, whether through economic, political, or social means, which allows them to shape the decision-making process in their favor.
3. Societal structures and historical factors: Oligarchies can be a product of longstanding social hierarchies or historical circumstances that favor a small elite group.
It is important to note that the existence of oligarchies is not limited to one specific sector or industry. The term can be used to describe various forms of power concentration, including political, economic, or even technological domains.
Moving on to your second question, an oligopoly is a market structure in which a small number of firms dominate the market. Here are a few examples of well-known oligopolists:
1. Apple: If you own an iPhone, iPad, or use Apple's services regularly, you are purchasing products from this technological giant.
2. Coca-Cola: If you consume Coca-Cola beverages, such as Coke or Sprite, you are a customer of this oligopolistic firm.
3. Amazon: If you frequently shop on Amazon, use Amazon Web Services (AWS), or own a Kindle device, you are engaging with this dominant player in online retail and cloud computing.
4. Microsoft: If you use Windows operating system, Office Suite, or own an Xbox gaming console, you are purchasing products from Microsoft, another oligopolist.
5. OPEC (Organization of the Petroleum Exporting Countries): While not a company, OPEC is an oligopoly that controls a significant portion of the global oil market, impacting prices and production levels.
Now, regarding the comparison between an oligopoly and monopolistic competition, there are a few key distinguishing factors:
1. Number of firms: In an oligopoly, only a few firms, typically less than ten, dominate the market. In monopolistic competition, there are numerous competing firms, often with a more significant number of participants.
2. Differentiation: In monopolistic competition, firms strive to differentiate their products or services through brand image, marketing, or slight variations in features. In an oligopoly, firms often engage in non-price competition, such as advertising, product innovation, or strategic alliances, to gain an edge over their rivals.
3. Interdependence: Oligopolistic firms are highly interdependent. Decisions made by one firm can significantly impact the strategies and outcomes of others. In monopolistic competition, firms have limited interdependence and can make independent pricing and production decisions without being overly concerned about the reactions of other competitors.
4. Barriers to entry: Oligopolies often have significant barriers to entry, such as high capital requirements or established brand loyalty. Monopolistic competition, on the other hand, typically has lower barriers to entry, allowing new firms to enter the market more easily.
Understanding these differences can help to distinguish between the two market structures.