What Are the Three Types of Market Structures With Imperfect Competition?

What Are the Three Types of Market Structures With Imperfect Competition?

Three types of market structures with imperfect competition are oligopsony, oligopoly and monopolistic competition. These structures exhibit an inefficient allocation of resources on account of their control over the market, which causes the prices to deviate from the marginal cost.

The phrase "imperfect competition" denotes a situation in which a market structure exhibits only certain features of competitive markets. Oligopoly is a market structure wherein a small number of large sellers have a significant control over the market, whereas oligopsony features a relatively similar number of competitors who have control over the market on the buying side. Monopolistic competition features a product differentiation with only subtle differences in goods produced.