Market structures Analysis- Term Paper INTRODUCTION Generally the concept of market structures can be essential to marketing and economics. Both emphasize the environment in which these companies operate and its importance it has on strategic decision making. Economics is more concerned about the degree of market competition and the pricing strategies of these firms. Marketing, on the other hand, concentrates its focus on consumer behaviour. Basically there are four major market structures – perfect competition, monopolistic competition, oligopoly, duopoly and monopoly.
Market Structures categorize companies based on different characteristics like the number of sellers in the overall market, the kind of product, market share, barriers to entry, pricing power, efficiency and profits.
Each of these specific criteria is used to describe the circumstances and the environment in which they operate. A firm can make more effective pricing and production decisions when it has a solid understanding of the industry it functions in. Four market structures exist in economics – perfect competition, monopoly, oligopoly, and oligopoly.
These structures can be compared by different characteristics. These characteristics are the number and size of firms in the industry, the amount of control over price held by the firm, the type or nature of product, the conditions of entry and exit into the market, the behaviour of the firms, and the amount of non-price competition. The characteristics of each of these market structures have different affects on our economy and should be managed in a different manner. This paper will outline these various characteristics and provide a narrative on their impact in the different markets.
The analysis of the different characteristics is made for different firms in the respective market structure. Degree of competition affect the consumer either positively or negatively, it also impacts on the performance and behaviour of the company/companies involved. Therefore each firm will be ranked in terms of competitiveness based on the analysis of those characteristics. 1. 2. BACKGROUND INFORMATION Prior the 15th century most economies in the world were self sufficient and were mainly based on agricultural production.
Families and households grew their own goods like corps and cattle. There was very little transnational trade. The majority of trade rather took place on a regional level. Most economies had relatively identical conditions in terms of productive capacity. As such, it can be claimed, that there was no economic anarchy and that the majority of the countries enjoyed a high degree of sovereignty and there was just little interaction and trade with other economies. Productivity and so economic efficiency at that time was relatively low, Rondo E. Cameron (Oxford University Press, 1993).
Economic performance and thus the performance in the agricultural sector was mainly based on human resources and the natural endowment of the economy, including its natural resources, geographical conditions and climate. Entry barriers, as defined previously, can be said to have not existed. With the beginning of the 15th century international trade was starting to catch up and experienced its first peak during the era of the British Industrial Revolution. This time period, which covers the 15th century until the early 19th century, is often also said to be the first Globalization period.
Already in the 15th century until the 18th century, increased trade among national economies was common. Eurasian countries during that time based their economic performance of trade on the mercantilist idea, which was popularized by Adam Smith (1776). Indeed, international trade began to blossom by the late 15th century which also led to an increase in money circulation. Nowadays economies throughout the world are experiencing the impact of modern globalization. In the last past decades many economies have developed and grown consistently, whereby some of these were able to acquire a major economic status.
The concept of modern globalization, which is based on the neoliberalistic view, suggests the cooperation between economies, where each economy specializes in its comparative advantage and removes trade barriers in order to achieve maximum effectiveness that should contribute to global equally distributed wealth. Simultaneously with the industrialization, the development of industry, capital investment and increased productivity and know how the first barriers to entry were established. However, these were still relatively low s the process of industrialization was still in its early stages. Also increased international trade and increased interdependence took place, due to growing demand for natural resources, such as coal and oil. Hence a shift in the factors of production took place. Before the factors of production were mainly based on human and natural resources, afterwards physical resources in form of industry add on to this. Thus the high degree of sovereignty could not be sustained anymore, and the belief in the mercantilist idea started to erode.
Nearly two decades after they were introduced structural adjustment policies continue to dominate public policy agenda in most African countries. In Tanzania structural adjustment programs dates back to early 980s following a period of sustained deterioration in social and economic conditions. A combination of internal and external factors contributed to systematic decline in manufacturing output and competitiveness. The stage of oligopoly represents the current time of the modern globalization that emerged in the 1980s.
In this time international trade was starting to increase in importance as trade barriers were removed and the opening up of several economies after the fall of the Berlin Wall, are seen as major historical events and as the beginning of the stage of Oligopoly. Through the growing international trade that takes places nowadays resources can be allocated most efficiently and each economy is enabled to specialize on its comparative advantage and so engage in international trade. As a consequence there is a growing interdependence among economies, as these depend on each others imports and exports.
One consequence of liberalization is the de facto merger of domestic and international markets into a single market and the necessity for domestic firms to become internationally competitive even in internal markets. The impact of globalisation is the accessibility to domestic firms, of resources that can facilitate enhanced productivity and efficiency necessary for competitiveness. Tanzanian firms and entrepreneurs like their counterparts in other parts of the world, have to strive towards production of higher quality goods and first class services at lower prices.
The overall strategy includes reform of institutional structures and change of cultural norms and practices in economic activities so as to put in motion the process of re-orienting the economy towards an open market system targeting export-orientation. The study provides understanding of the dynamics of structural changes and competitive behaviour. As conceptualized in this study, changes in manufacturing structures are reflected in shifting composition of manufacturing output resulting from changes in demand conditions, trade patterns and technology.
Thus, growth in some industries and stagnation or decline in others gives rise to sustained structural changes. Identifying and measuring the magnitude, pace and direction of structural changes is critical to successful policy intervention. 1. 3. LITERATURE REVIEW 1. 3. 1. Theoretical Literature Review on Market Structures Most of the Economists approach at the market structure with the intention of defining and predicting consumer behavior. It is important to note that market structure does not simply focuses on market share but instead it looks more towards the nature of competition and the pricing techniques used.
Market structure identifies how a market is made up in terms of: • The number of firms in the industry • The nature of the product produced • The degree of monopoly power each firm has • The degree to which the firm can influence price • Profit levels • Firms’ behaviour – pricing strategies, non-price competition, output levels • The extent of barriers to entry • The impact on efficiency Types of Market Structures The market structures ranges from perfect competition to pure monopoly which are classified in level of competitiveness, the number of competing firms n each market structure increases as you move from pure monopoly to perfect competition and the degree of monopoly exercised by firm is greater or increase down the category from perfect competition to monopoly. The four basic market structures include: perfect competition, monopolistic competition, oligopoly, duopoly, and monopoly. These categories have been made to help people understand how businesses operate and how prices, outputs and profits are determined. Market structure models
Market structure deals with a number of economic ‘models ‘these models are a representation of reality to help us to understand what may be happening in real life. There are extremes to the model that are unlikely to occur in reality but they still have value as they enable us to draw comparisons and contrasts with what is observed in reality. Models help therefore in analysing and evaluating – they offer a benchmark. Characteristics of each model: • Number and size of firms that make up the industry • Control over price or output • Freedom of entry and exit from the industry Nature of the product – degree of homogeneity (similarity) of the products in the industry (extent to which products can be regarded as substitutes for each other) • Diagrammatic representation – the shape of the demand curve, etc. The following are the basic markets structures or models which market up the market structures: 1. Perfect competition This is ideal state of economic affairs which does not exist in any industry. Four characteristics or conditions must be present for a perfectly competitive market structure to exist.
First, there must be many firms in the market, none of which is large in terms of its sales. Second, firms should be able to enter and exit the market easily. Third, each firm in the market produces and sells a non-differentiated or homogeneous product. Fourth, all firms and consumers in the market have complete information about prices, product quality, and production techniques. Price-taking behavior- A firm that is operating in a perfectly competitive market will be a price-taker. A price-taker cannot control the price of the good it sells; it simply takes the market price as given.
The conditions that cause a market to be perfectly competitive also cause the firms in that market to be price-takers. When there are many firms, all producing and selling the same product using the same inputs and technology, competition forces each firm to charge the same market price for its good. Because each firm in the market sells the same, homogeneous product, no single firm can increase the price that it charges above the price charged by the other firms in the market without losing business.
It is also impossible for a single firm to affect the market price by changing the quantity of output it supplies because, by assumption, there are many firms and each firm is small in size. 2. Monopolistic or Imperfect Competition Where the conditions of perfect competition do not hold, ‘imperfect competition’ will exist; Varying degrees of imperfection give rise to varying market structures. Characteristics: • In each case there are many firms in the industry • Consumers and producers do not have perfect knowledge of the market – the market may indeed be relatively localised. May have some element of control over price due to the fact that they are able to differentiate their product in some way from their rivals – products are therefore close, but not perfect, substitutes • Entry and exit from the industry is relatively easy – few barriers to entry and exit In economics, the market consists of many buyers and sellers who trade over a range of prices rather than a single market price and may reflect a wide range of markets, for examples are; Restaurants, Plumbers/electricians/local builders, Solicitors, Private schools, Plant hire firms, Insurance brokers, Health clubs Hairdressers etc.
A range of price occurs because sellers can differentiate their offers to buyers. Sellers try to develop difference by using – customer segments, and in addition to price, freely uses branding, advertising, and personal selling to set their offers apart. 3. Oligopoly Competition between the few, May be a large number of firms in the industry but the industry is dominated by a small number of very large producers. Oligopoly is a market structure characterized by a small number of relatively large firms that dominates an industry.
The market can be dominated by as few as two firms or as many as twenty, and still be considered oligopoly example is the music industry that has a 5-firm concentration ratio of 75%. Independents make up 25% of the market but there could be many thousands of firms that make up this ‘independents’ group. An oligopolistic market structure therefore may have many firms in the industry but it is dominated by a few large sellers. With fewer than two firms, the industry is monopoly. As the number of firms increase (but with no exact number) oligopoly becomes monopolistic competition.
Because an oligopolistic firm is relatively large compared to the overall market, it has a substantial degree of market control. It does not have the total control over the supply side as exhibited by monopoly, but its capital is significantly greater than that of a monopolistically competitive firm. Relative size and extent of market control means that interdependence among firms in an industry is a key feature of oligopoly. The actions of one firm depend on and influence the actions of another. Such interdependence creates a number of interesting economic issues.
One is the tendency for competing oligopolistic firms to turn into cooperating oligopolistic firms. When they do, inefficiency worsens, and they tend to come under the scrutiny of government. Alternatively, oligopolistic firms tend to be a prime source of innovations, innovations that promote technological advances and economic growth. Like much of the imperfection that makes up the real world, there is both good and bad with oligopoly. The challenge in economics is, of course, to promote the good and limit the bad. Characteristics
The three most important characteristics of oligopoly are: (1) an industry dominated by a small number of large firms, (2) firms sells either identical or differentiated products, and (3) the industry has significant barriers to entry. • Price may be relatively stable across the industry – The firm therefore, effectively faces a ‘kinked demand curve’ forcing it to maintain a stable or rigid pricing structure. Oligopolistic firms may overcome this by engaging in non-price competition. • Potential for collusion • Behaviour of firms affected by what they believe their rivals might do – interdependence of firms Branding and brand loyalty may be a potent source of competitive advantage • Small Number of Large Firms: An oligopolistic industry is dominated by a small number of large firms, each of which is relatively large compared to the overall size of the market. This generates substantial market control, the extent of market control depending on the number and size of the firms. • Identical or Differentiated Products: Some oligopolistic industries produce identical products, while others produce differentiated products.
Identical product oligopolies tend to process raw materials or intermediate goods that are used as inputs by other industries. Notable examples are petroleum, steel, and aluminum. Differentiated product oligopolies tend to focus on consumer goods that satisfy the wide variety of consumer wants and needs. A few examples of differentiated oligopolistic industries include automobiles, household detergents, and computers. • Barriers to Entry: Firms in a oligopolistic industry attain and retain market control through barriers to entry.
The most common barriers to entry include patents, resource ownership, government franchises, start-up cost, brand name recognition, and decreasing average cost. Each of these makes it extremely difficult, if not impossible, for potential firms to enter an industry. Behavior Although oligopolistic industries tend to be diverse, they also tend to exhibit several behavioral tendencies: (1) interdependence, (2) rigid prices, (3) nonprice competition, (4) mergers, and (5) collusion. • Interdependence: Each oligopolistic firm keeps a close eye on the activities of other firms in the industry.
Decisions made by one firm invariably affect others and are invariably affected by others. Competition among interdependent oligopoly firms is comparable to a game or an athletic contest. One team’s success depends not only on its own actions but on the actions of its competitor. Oligopolistic firms engage in competition among the few. • Rigid Prices: Many oligopolistic industries (not all, but many) tend to keep prices relatively constant, preferring to compete in ways that do not involve changing the price. The prime reason for rigid prices is that competitors are likely to match price decreases, but not price increases.
As such, a firm has little to gain from changing prices. • Nonprice Competition: Because oligopolistic firms have little to gain through price competition, they generally rely on nonprice methods of competition. Three of the more common methods of nonprice competition are: (a) advertising, (b) product differentiation, and (c) barriers to entry. The goal for most oligopolistic firms is to attract buyers and increase market share, while holding the line on price. • Mergers: Oligopolistic firms perpetually balance competition against cooperation.
One way to pursue cooperation is through merger–legally combining two separate firms into a single firm. Because oligopolistic industries have a small number of firms, the incentive to merge is quite high. Doing so then gives the resulting firm greater market control. • Collusion: Another common method of cooperation is through collusion–two or more firms that secretly agree to control prices, production, or other aspects of the market. When done right, collusion means that the firms behave as if they are one firm, a monopoly.
As such they can set a monopoly price, produce a monopoly quantity, and allocate resources as inefficiently as a monopoly. A formal method of collusion, usually found among international produces is a cartel. 4. Duopoly Kotler P. and Keller, K (2008) defines duopoly as the market structure where the industry is dominated by two large producers with the following characteristics features: • Collusion may be a possible feature • Price leadership by the larger of the two firms may exist – the smaller firm follows the price lead of the larger one. • Highly interdependent High barriers to entry • Cournot Model – French economist – analysed duopoly – suggested long run equilibrium would see equal market share and normal profit made 5. monopoly Monopoly is a market structure, where there only a single seller producing a product having no close substitutes. Pure monopoly – where only one producer exists in the industry, in reality, rarely exists – always some form of substitute available. Monopoly exists; therefore where one firm dominates the market, Firms may be investigated for examples of monopoly power when market share exceeds 25%.
Kotler P. and Keller, k (2008), explains Monopoly power – referring to cases where firms influence the market in some way through their behaviour – determined by the degree of concentration in the industry Influencing prices, Influencing output, Erecting barriers to entry, Pricing strategies to prevent or stifle competition, May not pursue profit maximisation – encourages unwanted entrants to the market, and Sometimes seen as a case of market failure. Characteristics / Features of Monopoly Following are the features or characteristics of Monopoly:- A single seller has complete control over the supply of the commodity. • There are no close substitutes for the product. • There is no free entry and exit because of some restrictions. • There is a complete negation of competition. • Monopolist is a price maker. • Since there is a single firm, the firm and industry are one and same i. e. firm coincides the industry. • Monopoly firm faces downward sloping demand curve. It means he can sell more at lower price and vice versa. Therefore, elasticity of demand factor is very important for him. Origins of monopoly: Through growth of the firm • Through amalgamation, merger or takeover • Through acquiring patent or license • Through legal means – Royal charter, nationalisation, wholly owned plc Summary of characteristics of firms exercising monopoly power: • Price – could be deemed too high, may be set to destroy competition (destroyer or predatory pricing), price discrimination possible. • Efficiency – could be inefficient due to lack of competition (X- inefficiency) or could be higher due to availability of high profits • Innovation – could be high ecause of the promise of high profits, Possibly encourages high investment in research and development (R) • Collusion – possible to maintain monopoly power of key firms in industry • High levels of branding, advertising and non-price competition. Classification / Kinds / Types of Monopoly Pure monopoly-In economics, an industry with a single firm that produce a product, for which there are no close substitutes and in which significant barriers to entry prevent other firms from entering the industry to compete for profit is called pure monopoly.
Example: When the ‘Telecommunication service company (TTCL) when first started their business in Tanzania, they were the only Telecommunication service provider then. Before the ‘The mobile phones’ came into the market, they enjoyed pure monopoly. There are two types of pure monopoly: 1. Regulated monopoly 2. Non-regulated monopoly Regulated monopoly: The government permits the company to set rates that will yield a “fair return”. Example: Power Company. Non-regulated monopoly: Company is free to price at what the market will bear. Example: Power Company in Tanzania ‘TANAESCO’
Monopsony: This is the market situation where there is only one buyer in the market. Take example in Tanzania only Cooperative societies were only buyers of major Cash Crops such as Coffee, Cashew Cotton etc before the introduction of free market and linearization of trade when the country was under closed economy system. Natural Monopoly-It emerges as a result of natural advantages like good location, abundant mineral resources, etc. e. g. Gulf countries are having monopoly in crude oil exploration activities because of plenty of natural oil resources and Tanzania having monopoly in Tanzanite Minerals. 1. 3. 2. Empirical literature review
There is a body of literature which address the issues of competitive market structures with the major question being “how is the structure of competition viewed by consumers? ” Market structure analysis refers to the process of organizing a set of products / brands such that their interrelationships are apparent (Allenby, 1989) or decomposing product markets into managerially useful partitions (Russel and Bolton, 1988). Since the seminal article by Day, Shocker, and Srivastava (1979), several different types of techniques or consumer models have been developed, mostly based on demand side perception or behaviors.
The demand-side issue of the identification of the competitive structure is crucial for assessing strategic opportunities, identifying competitive threats including cannibalization, developing marketing programs, and assessing market share to evaluate performance ( eitz, 1985; Vilcassim, 1989). The ability of firms to exercise market power by setting prices is a major concern to both economists and policymakers. An extensive literature beginning with Bain (1951) has examined the relationship between market structure, as measured by market concentration and firms’ market share, and the exercise of market power.
Two main research streams can be distinguished: the “structural” approach and the “efficiency” approach. The most prominent representative of the structural approach is the structure-conduct-performance (SCP) paradigm. The SCP paradigm advocates a direct like between market concentration and the degree of competition. According to the SCP paradigm, a higher market concentration allows banks to exploit their market power by earning higher profits. Although these studies contribute both theoretical and practical knowledge about market structures, they are not able to provide complete pictures of market structures and competition.
A manager may require a more detailed (demand-side) picture of the market structure and competition in the short run such as ( i ) lead and lag effects 1 of marketing variables on demand, ( ii ) directions of competition (i. e. asymmetry). Also the supply-side issues of market structures, although important, have not been explored in this area. The second issue, asymmetric switching or sales change between high quality and low quality brands, has been well documented. Empirical studies have shown that price reductions in higher quality brands attract more buyers han do price reductions in lower quality brands (Blattberg and Wisniewski, 1989; Kamakura and Russell, 1989; Allenby and Rossi, 1991). When a high quality brand price deal, it steals sales from both other high quality brands and low quality brands. However, low quality brands takes unit sales from other low quality brands, but rarely take sales from high quality brands. 1. 4. OBJECTIVE OF THE STUDY 1. 4. 1. General objective The objective of this study is to make analysis of the market structures and assess the level of competition relative to each market structure. The specific objectives are; 1. 4. 2. Specific objectives To examine the level of competition in each structure and its impact on the behavior and performance of the firms. • To assess and examine the factors or characteristics that influences the market structures. • To analyze the nature of market structure in Tanzania 1. 4. 3. Study questions In addressing these issues the study is guided by the following set of questions: 1. To what extent the competition affect the market structure adjustment and led improvement in performance of the firms? 2. What are the internal or external factors influencing adjustment or adaptation among manufacturing industries or firms? . is there any evidence of inter-industry or inter-firm differences in adjusting or adapting to policy changes? Methodology This chapter presents the methods of how the data or information will be collected and analyzed in order to achieve the objectives of the study. 2. 1. STUDY APPROACH The study will employ both quantitative and qualitative approaches in collecting the data and information concerning the study topic where by different journals, Empirical data and literatures will be used in the study 2. 2. DATA COLLECTION INSTRUMENTS
In order to obtain relevant information both primary and secondary data were collected by using the following techniques depending to the availability and accessibility of their sources. The following instruments were employed; documentary review and consulting the experts. Primary data were collected through interview and correspondence. The study intensively reviewed documents to enrich on the literature. Focusing group was firms participating in each market structure or model mainly oligopoly, duopoly and monopoly. The study questions were used as an aid in analyzing and collecting the data. 2. 3.
DATA PRESENTATION AND ANALYSIS Competitiveness is broadly defined as the ability by national economies and industries to withstand internal or external competitive pressure. It is often measured in terms of trade performances such as trade surplus or deficit, domestic and international market shares. The determinants of competitiveness as defined in this study include technological changes, managerial capabilities and a wide range of public policies. In addressing the fundamental question of this study of what extent the competition affect the market structure adjustment and led improvement in performance of the firms?
Various studies and literatures evidenced this. Komba A. Adalgot. (199), on his study titled “Structural Change and Competitiveness in Tanzania’s Manufacturing Sector” The study carried out in various industries in Tanzania which included manufacturing industries where the following observations were made; the was no evidence of significant improvement in performance of manufacturing industries, within the textile industry over 80 per cent of mills are either closed or operating at very low capacities.
The same applies to engineering and cement industries, the study highlighted that monopoly condition in cement industry is helping sustain production albeit at reduced capacities. In addressing the structural adjustment policies of the past two decades he concluded that there have made little contribution to changes in structural composition of manufacturing output and Tanzania’s manufacturing industries remains dominated by light, resources based industries; food, beverages, tobacco, textile and leather industries.
Further more the study points out that the exchange rate adjustments and trade liberalization, the two distinct adjustment policies had adverse impact on the local industries. Currency devaluation has substantially increased production costs while trade liberalization led to the flooding of local market with imported merchandise. As a result local manufacturers have come under intense competitive pressure. The evidence suggests that the performance has been dismal and competitiveness on the decline. n identifying and analyzing the characteristics or factors that effect the nature of market structures the study selected five market structures found in Tanzania where the following variables were observed; OLIGOPOLY Example: Banking Industry Defining Characteristics of Model Number of Firms- many but few banks dominate the industry (NMB, CRDB, EXIM BANK, NBC) Type of product- Somewhat differentiated Conditions of entry/Barriers to entry- Significant Obstacles: Regulated by the government, Bank licensing requirements, Minimum capital thresholds/ratios, business plan, Requirements for controller, directors, and officers.
Control over price – Strategic behavior – firm sets the price, location, and service approaches at the same time it analyzes the pricing of competitive. Non-price competition – Typically a great deal, particularly with product differentiation, Considerable non-price competition- Product differentiation advertised through media (TV commercials radio, and Internet), Credit Card segment through direct mail channels. The marketing structure characteristics for the banking industry are highlighted above.
After analyzing the five main characteristics, the banking industry was determined to have an oligopoly marketing structure. First, while many banks are in the industry, only a few have a significant portion of the market. According to McConnell and Brue (2004, p. 468), the banking industry has experienced a wave of mergers that increased the market share of the remaining firms. Second, the banking industry has differentiated products. Third, the banking industry is a price maker but with the caveat of having to consider the actions of competitors.
Next, the banking industry has significant barriers that must be overcome before entering the industry. Regulatory, licensing, and capital requirements impede new firms from entering into the industry. Lastly, the banking industry practices non-price competition by highlighting product differentiation. Furthermore, a significant amount of money is spent on advertising through media and direct marketing channels. PURE COMPETITION Example: Frozen Food Supplier Industry Defining Characteristics of Model Number of Firms – Many approximately 1,557 Type of product – standardized
Conditions of entry/Barriers to entry – very easy to none entry, relatively easy to enter the market with the proper assets Control over price – none – Price is set by commodities, and processing. Company is a Price taker Non-price competition – Non-Price competition does not exist. Because the market sets the price and the companies involved move to meet that price. Five characteristics of market structure An important factor in starting any business in any industry is the number of competitors in the market (McConnell & Brue, 2004, p. 414). In a purely ompetitive market, there exists the opportunity for many firms to enter the market. According to the American Frozen Food Institute, the 550 industry members produce approximately 90% of the frozen foods processed in the United States (Sarasin, 2002, ¶ 3). This is also the case in the mortgage industry where thousands of firms compete for business. In the case of monopolistic market models like utilities and pharmaceutical manufacturers, competitive firms are few. This is also the case found in Oligopolies, like military logistics firms and large banking firms. The product offered by a company can help determine the market structure.
Products are standardized or differentiated. In a pure competition market products are standardized; therefore, companies do not make efforts to differentiate their products (McConnell and Brue, 2004, p. 414). In contrast, a pure monopoly will have products with no close substitutes (McConnell and Brue, 2004, p. 438). Oligopolies can have both differentiated or standardized products (McConnell and Brue, 2004, p. 467). The five areas that are examined to determine differentiation are the following: product attributes, service, store location, brand names and packaging, and control over price.
When a product meets the differentiation criteria the company falls into the monopolistic competition market (McConnell and Brue, 2004, p. 461). Of the companies analyzed, only the frozen foods supplier was in the pure competition market, as the product is similar to other available products on the market. Military logistics, banking, and clothes all offer differentiated products, having different levels of service for customers, some control over product pricing as well as products that have multiple features, or varying design. DUOPOLY
Number of Firms – Many approximately 1,557 Type of product – standardized Conditions of entry/Barriers to entry – very easy to none entry, relatively easy to enter the market with the proper assets Control over price – none – Price is set by commodities, and processing. Company is a Price taker Non-price competition – Non-Price competition does not exist. Because the market sets the price and the companies involved move to meet that price. Five characteristics of market structure 3. 0 |Control over price. FIND Control over price INGS 4. 0. CONCLUSIONS
The central purpose of the study has been to understand the dynamics of Structural change and competitive behavior by analyzing structures and Performance of Tanzania’s manufacturing industries. In conceptualizing The study it was noted that structural change and competitiveness are the outcome of complex interaction of macro and micro factors. The study identifies and analyzes sources, indicators and determinants of structural change and competitiveness REFERENCES 1. Rondo E. Cameron, A Concise Economic History of the World, (Oxford University Press, 1993) 15. 2. Komba A.
Adalgot, (199), Structural Change and Competitiveness in Tanzania’s Manufacturing Sector; PhD Dissertation, George Washington University, Washington D. 3. McConnell, C. R. & Brue, S. L. (2004). Economics: Principles, problems, and policies (16th ed. ). New York: McGraw Hill/Irwin. 4. Sarasin, L. (2002, 08/30/2002). Docket: 02N-0278 – Bioterrorism Preparedness; Prior Notice of Imported Food Shipments, Section 307Comment Number: EC -12 [White paper]. Retrieved from US Food and Drug Administration: http://www. fda. gov/ohrms/dockets/dockets/02n0278/02N-0278-EC-12. htm
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