Oligopolies are considered stable, the main reason being, the participating firms realize the benefits of collaboration over the costs of economic competition, and thereby agree to not compete but instead agree on the benefits of cooperation. The firms sometimes find innovative ways to avoid the appearance of price-fixing, such as using phases of the moon.
An oligopoly is a type of market structure that plays an important role in the economy of a country. There are four main types of market structures: pure competition, monopoly, oligopoly, and monopolistic competition. Market structures occur in different forms and sizes. The terms like monopoly or oligopoly are used to describe the distinctions between industries, which are made up of different companies that sell diverse products and services. The word Oligopoly is derived from two Greek words – ‘Oligi’ meaning ‘few’ and ‘Polein’ meaning ‘to sell’. A....
