Oligopoly

Oligopoly is a market structure with a few companies that sell both homogeneous and differentiated products to many buyers.

All firms on a oligopoly market can affect the market price. Oligopoly is characterized by competitors that follow any price change that a company is taking. Oligopoly means that competitors lower their prices when a company lowers the price but keep prices unchanged when a company raises its prices.

Oligopoly means higher prices for consumers compared to a perfect market and monopolistic competition but lower prices compared to a monopoly.