7.5 Decision of Price and Output Under Oligopoly Market 寡头垄断市场上的价格和产量的决定
寡头垄断市场上的价格和产量的决定 7.5 Decision of Price and Output Under Oligopoly Market
教学目标 Objectives: 了解寡头垄断的市场特征 ■掌握寡头垄断市场勾结情况下价格和产量的决定 ■掌握寡头垄断市场不勾结情况下价格和产量的决定 掌握四种市场结构的比较 知识点 Knowledge 价格领先制、卡特尔、四种市场结构的比较 技能点SMi 理解寡头垄断市场上价格和产量的决定
教学目标Objectives： ▪ 了解寡头垄断的市场特征 ▪ 掌握寡头垄断市场勾结情况下价格和产量的决定 ▪ 掌握寡头垄断市场不勾结情况下价格和产量的决定 ▪ 掌握四种市场结构的比较 知识点Knowledge： 价格领先制、卡特尔、四种市场结构的比较 技能点Skills： 理解寡头垄断市场上价格和产量的决定
专业词汇 Professional terms Oligopoly Market price-taker interdependence market structure tacit collusion intensive marketing campaign cartel quota Barometric price leadership Dominant firm price leadership Price benchmarks THE KINKED DEMAND CURVE
Oligopoly Market price-taker interdependence market structure tacit collusion intensive marketing campaign cartel quota Barometric price leadership Dominant firm price leadership Price Benchmarks THE KINKED DEMAND CURVE 专业词汇Professional terms
1 DEFINITION AND FEATURES OF OLIGOPOLY Oligopoly describes a market structure where just a few firms between them control a large proportion of the industry. It is probably the most dominant market structure in the uk today. Most oligopolists produce differentiated products and much of the competition between them is in the marketing of their particular brands. The greater the product differentiation, the greater the scope to be a price-maker rather than a price-taker
1 DEFINITION AND FEATURES OF OLIGOPOLY Oligopoly describes a market structure where just a few firms between them control a large proportion of the industry. It is probably the most dominant market structure in the UK today. Most oligopolists produce differentiated products and much of the competition between them is in the marketing of their particular brands. The greater the product differentiation, the greater the scope to be a price-maker rather than a price-taker
1 DEFINITION AND FEATURES OF OLIGOPOLY Despite the differences between firms in oligopolistic markets, there are therefore two key features that distinguish oligopoly from other market structures 1. Barriers to entry. The size of the barrier will differ from industry to industry In some cases entry is relatively easy, while in others it is very difficult 2. Interdependence of the firms
1 DEFINITION AND FEATURES OF OLIGOPOLY Despite the differences between firms in oligopolistic markets, there are therefore two key features that distinguish oligopoly from other market structures: 1. Barriers to entry. The size of the barrier will differ from industry to industry. In some cases entry is relatively easy, while in others it is very difficult. 2. Interdependence of the firms
1 DEFINITION AND FEATURES OF OLIGOPOLY 寡头市场在价格与产量决策上有以下三方面特点: ■一是它很难对产量与价格问题做出像前三种市场类型 那样确切而肯定的答案。 ˉ二是价格和产量一旦确定以后,就有其相对稳定性 这也就是说,各个寡头由于难以捉摸对手的行为, 般不会轻易变动已确定的价格与产量水平 三是各寡头之间的相互依存性,使他们之间更容易形 成某种形式的勾结。但各寡头之间的利益又是矛盾的 这就决定了勾结不能代替或取消竞争,寡头之间的竞 争往往会更加激烈。这种竞争有价格竞争,也有非价 格竞争
1 DEFINITION AND FEATURES OF OLIGOPOLY 寡头市场在价格与产量决策上有以下三方面特点： ▪一是它很难对产量与价格问题做出像前三种市场类型 那样确切而肯定的答案。 ▪二是价格和产量一旦确定以后，就有其相对稳定性。 这也就是说，各个寡头由于难以捉摸对手的行为，一 般不会轻易变动已确定的价格与产量水平。 ▪三是各寡头之间的相互依存性，使他们之间更容易形 成某种形式的勾结。但各寡头之间的利益又是矛盾的， 这就决定了勾结不能代替或取消竞争，寡头之间的竞 争往往会更加激烈。这种竞争有价格竞争，也有非价 格竞争
2 COMPETITION AND COLLUSION Oligopolists are pulled in two different directions 1. The mutually dependence of firms may tempt them to join together. If they collude in this manner they could jointly maximize industry profits 2. On the other hand there is a great temptation for an individual firm to compete with its rivals to gain market share
2 COMPETITION AND COLLUSION Oligopolists are pulled in two different directions: 1. The mutually dependence of firms may tempt them to join together. If they collude in this manner they could jointly maximize industry profits. 2. On the other hand there is a great temptation for an individual firm to compete with its rivals to gain market share
2. 1 COLLUSIVE OLIGOPOLY Collusive oligopoly occurs where firms agree either formally or informally, to limit the competition between them. They may agree on prices, market share, advertising expenditure etc Such collusion will reduce the uncertainty the firms face in a fiercely competitive environment. It will reduce the fear of engaging in competitive price cutting or other strategies, which could reduce total industry profit
2. 1 COLLUSIVE OLIGOPOLY Collusive oligopoly occurs where firms agree, either formally or informally, to limit the competition between them. They may agree on prices, market share, advertising expenditure etc. Such collusion will reduce the uncertainty the firms face in a fiercely competitive environment. It will reduce the fear of engaging in competitive pricecutting or other strategies, which could reduce total industry profit
2. 1 COLLUSIVE OLIGOPOLY Profit-maximising cartel Price The total market demand urve is shown with th P corresponding market MR curve. The cartel,s Industry MO curve the M horizontal sum of the mc curves of its members This is because we are adding the output of each of the cartel members at h level of m Industry cost Profits D=AR maximized at Q where Industry MC=MR. The cartel wil Q MR Quantity therefore set a price of p t which o will be Figure 1. profit-maximizing demanded cartel
2. 1 COLLUSIVE OLIGOPOLY P Profit-maximising cartel The total market demand curve is shown with the corresponding market MR curve. The cartel’s MC curve is the horizontal sum of the MC curves of its members. This is because we are adding the output of each of the cartel members at each level of marginal cost. Profits are maximized at Q where MC=MR. The cartel will therefore set a price of P at which Q will be demanded. 0 Q Quantity Industry MR Industry D=AR Industry MC Price Figure 1. Profit-maximizing cartel
2. 2 HOW DOES THE CARTEL DIVIDE UP THE MARKET? one way of dividing the market would be by using non-price competition for each firm to gain as big a share of the resulting sales as they can Another method would be for each of the cartel members to agree on dividing the market up between them in a particular way so that each member is given a quota
2.2 HOW DOES THE CARTEL DIVIDE UP THE MARKET? one way of dividing the market would be by using non-price competition for each firm to gain as big a share of the resulting sales as they can. Another method would be for each of the cartel members to agree on dividing the market up between them in a particular way so that each member is given a quota