In perfectly competitive markets, the ready imitation of rivals makes ongoing success a constant struggle. In monopoly markets, entry and growth by nonleading firms often eat away at proprietary advantages. In both instances, development of an effective competitive strategy is vital to long-run success.
The search for a favorable competitive position in an industry or line of business economic luck
Temporary good fortune due to unexpected changes in industry demand or cost conditions economic rents
Profits due to uniquely productive inputs disequilibrium profits
Above-normal returns that can be earned in the time interval between when a favorable influence on industry demand or cost conditions first transpires and the time when competitor entry or growth finally develops disequilibrium losses
Below-normal returns that can be suffered in the time interval that often exists between when an unfavorable influence on industry demand or cost conditions first transpires and the time when exit or downsizing finally
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