Oligopolies are usually seen as being negative to the general public. There are certainly disadvantages of oligopolies, including reduced consumer choice. However, the disadvantages are also matched with some advantages, including price stabilization.Continue Reading
An oligopoly occurs when an industry, such as the automobile industry, has few competitors.
Most of an oligopoly's disadvantages are matched with an equal advantage. Many times, there are so few competitors because companies in the industry make it next to impossible for new companies to break through.
Because consumers have so few choices in an oligopoly, the companies generally have no incentive to keep prices low, so consumers usually spend more for the goods or services. However, this lack of competition can work to stabilize prices so that they don't fluctuate and surprise consumers, allowing them to plan ahead for large purchases.
Businesses involved in an oligopoly may not have great incentive to be efficient in their production of goods and services, which can lead to consumer frustration. Because of the greater amount of time companies have to work on production, though, they are more able to be innovative in their approach to production. This paves the way to new inventions and more stable goods and services.Learn more about Economics
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The advantages of a monopoly include reducing resource waste, improving efficiency due to better investments, providing discounts to the economically weak and investing in research and development; some disadvantages include poor service, low quality goods and higher prices, no consumer sovereignty and no competition. When a monopoly has low competition, this may result in consumers getting goods that are either out of date or low in quality.Full Answer >
Some advantages of tourism are job creation, expansion of local infrastructure, such as roads, public transportation and sanitation facilities, and education of tourists. Meanwhile, many advantages are also disadvantages. For example, job creation does occur, but many of these jobs tend to be menial and offer little chance of advancement; the jobs that do offer upward movement are often filled from outside.Full Answer >
Advantages of the Association of Southeast Asian Nations include the elimination of tariffs between member states, which has reduced product prices due to increased competition within the market, and possible investment opportunities in the market. Among the disadvantages of ASEAN are the risk of an influx of cheap imports flooding local markets and the existence of poor governance structures in some member countries.Full Answer >