Info

Sources: SEC reports and http://yahoo.finance.com.

Sources: SEC reports and http://yahoo.finance.com.

See: Judith Burns, "Buffett Tells Investors to Get Tough with Companies," The Wall Street Journal Online, March 5, 2002 (http://online.wsj.com).

Finally, considering concentration ratio and HHI data in isolation can lead to deceptive conclusions regarding the vigor of competition because they measure only part of market structure; other components include barriers to entry or exit, nonprice competition, vertical integration, and so on. Under certain circumstances, even a very few large competitors can compete vigorously. Competition among the few can be spirited. For example, the market for large commercial and military aircraft is viciously competitive despite being dominated by only two global competitors: Boeing, from the United States, and Airbus Industrie, the European multinational consortium. In addition to considering the number and size distribution of competi tors, firms must judge the competitive environment in light of foreign competition, transportation costs, regional product differences, likely potential entrants, advertising, customer loyalty, research and development, demand growth, and economies of scale in production, among other factors, to make accurate pricing and output decisions. All of these features constitute important elements of market structure.

Was this article helpful?

0 0
Your Retirement Planning Guide

Your Retirement Planning Guide

Don't Blame Us If You End Up Enjoying Your Retired Life Like None Of Your Other Retired Friends. Already Freaked-Out About Your Retirement? Not Having Any Idea As To How You Should Be Planning For It? Started To Doubt If Your Later Years Would Really Be As Golden As They Promised? Fret Not Right Guidance Is Just Around The Corner.

Get My Free Ebook


Post a comment