It is known that the market of the perfect competition provides such model of work at which certain sellers and buyers cannot influence the price policy, but form by the participation supply and demand. They only adapt to an equilibrium condition of conditions in the market of commodity and services.
Often market of the perfect competition can be called clear or free. High mobility of factors of production, full and, the main thing, equal access to information (price informing) of all participants, lack of any barriers to an entrance or an exit of products, uniformity and divisibility of products, infinity of number of the buyers and sellers participating in the scheme are the lines of the market of the perfect competition determined by experts.
What conditions of the market of the perfect competition are met by subjects?
In case the called features are absent, the competition is called imperfect. Sometimes features of the market of the perfect competition are eliminated violently, then it is about monopoly. Competition becomes unfair. It is possible to refer bribery to various representatives of public administration in an obvious or implicit look to its such types. For bribes preferences, that is indulgences are provided to buyers or sellers. However there are also shortcomings of the market of the perfect competition, for example, decrease in profit of each of sellers.
What value of the market of the perfect competition in world trade?
Among examples of the market of the perfect competition it is worth calling first of all the exchange market. In the conditions of an economic crisis such system can suffer a failure. Only external intervention is capable to save the exchange from fiasco.
What characteristic of the market of the perfect competition, its main features? Let's note what works hard at such market small firms. Any is independent, makes decisions independently. The share of each of the participating firms is small therefore their decisions cannot fully affect cardinal change of the price policy. The output of services, goods at the same time is also insignificant. The main advantages of the market of the perfect competition are that any firm is only a tsenopoluchatel. The products at the same time are made uniform therefore for the buyer there is no difference from whom to buy the necessary goods.
What the mechanism of the market of the perfect competition is based today on?
For the market of the clean competition perhaps painless entry of new firms into the industry. Information is available. To zero costs of its receiving equal. Also characteristic of the market of the perfect competition provides optimum volume in production. The prices are equal to expenses, that is for production of the benefit the optimum volume of useful resources is allocated. At such scheme of work all factors are expediently distributed between all industries. Also the market of the perfect competition provides equality of expenses of average and limit, that is gradually expenses of all firms of the industry are leveled. However some of them can use unique factors in production, then the above-mentioned rule does not work.
Minimization of average expenses allows to settle number of competitors in any given segment. If to consider the short-term periods, then different firms can have free access to the industry and change extent of loading of capacities in production. It is possible to argue with many conclusions of rather perfect market therefore the question of its expediency in many respects remains open.