What Are Mutual Interdependence and Oligopolies?

Mutual interdependence is a characteristic of an oligopoly. An oligopoly is a form of market. In oligopolies, the number of oligopolists, the sellers or producers, is limited. The word “oligopoly” comes from medieval Latin, where “oligo” means “a few” or “small” and “poly” means “to sell.”

Mutual interdependence is when two or more entities depend on one another. In the case of an oligopoly, companies within a market are mutually interdependent. Each company has to consider the consequences of a change in strategy on competitors within that market. Oligopolists try to maximize profit. They work together to make it difficult for others to enter their market.