What is the most important feature that distinguishes an oligopolistic market from the other markets. Explain the market conditions for 4 types of oligopolistic markets and explain Sweezy type of oligopolistic model (Kinked demand curve). The Most Important Feature of Oligopolistic Markets and the Sweezy Mode

The Most Important Feature of Oligopolistic Markets and the Sweezy Mode

An oligopoly is a market structure where a few large firms dominate a market and compete with each other for market control. It is a distinct market structure from the other market types such as perfect competition, monopolistic competition, and monopoly. The most important feature that distinguishes an oligopolistic market from other markets is the interdependence of firms (Halevi & Kriesler, 2022). As firms in an oligopolistic market are few in number, their actions and decisions highly affect each other and therefore, they must take into account the actions of their competitors when making decisions. There are four types of oligopolistic markets: (1) Collusive oligopoly, (2) Duopoly, (3) Cournot oligopoly, and (4) Stackelberg oligopoly (King, 2022). In a collusive oligopoly, the firms come together and collude to set the price and quantity of production in order to maximize their profits. In a duopoly, there are only two firms in the market, and they compete with each other to increase their market share. In a Cournot oligopoly, firms compete by setting their quantities of production, and the market price is determined by. Cont…