Definition of Oligopoly
What is an "oligopoly"? What is the definition of the term "oligopoly"?
An oligopoly occurs when a small number of sellers dominate a single industry.
On the other hand, a monopoly occurs when just one seller dominates an industry.
Examples of oligopolies?
In Canada, six major banks dominate the nation's banking industry. This is an oligopoly.
In many countries throughout the world, the media is dominated by just a few companies. For instance, Rupert Murdoch's News Corp. empire owns many TV stations and newspapers throughout the world.
In the United States, the majority of the movies that hit movie theaters are released by one of a small handful of major studios. This would be an oligopoly as well.
Oligopolies often make moves in concert. For instance, if one of the major banks in Canada raises their fees, then there is a high chance that the others will follow.
Just like with a monopoly, smaller companies often have a very hard time competing against the larger companies that make up an oligopoly.
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