© 2000 John Petroff
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© 2000 John Petroff |
In the preceding section, several instances of actions by competitors were shown to have serious consequences for other firms in the industry. What these actions are and the extent of their impact depends on industry composition. One would obviously remember from an introductory course in economics that firms in perfect competition have no power, firms in imperfect competition will retaliate or try to collude, and a monopoly has complete power. Reality is not that simple, and that is what we will attempt to paint with many of its shades by looking at industry concentration, leadership types, alliances, government intervention and diversification efforts.
See review questions Q-14.1 through Q-14.4.
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