Micro Perspectives On Technological Competition

could then result in perfect competition in the supply of products. Firms would be price

A majority of the attractiveness stems from the abnormally low buyer and supplier power. However, this gain is offset by the current low barriers of entry and high competitive rivalry. In order to remain competitive, incumbents must (1) invest heavily in research and development, (2) secure technology via patents, (3) market heavily to monetize products, all of which will diminish bottom line results.

The competition among rivals is very high due to price and non-price factors. Companies try to attract customers to their products by introducing

Markets differ in a variety of ways including the degree of concentration and competitiveness, a fact which is reflected in the concept of ‘market structure’. Economists’ models link the structural characteristics of a market to the behaviour of firms in that market and subsequently to their performance. A key question therefore is how far a firm’s strategic decisions are shaped by the structure of the market in which it operates.

E., & Gould, J. P., 1966). Furthermore, the members are price takers and do not have the power to influence price changes. We now understand that perfectly competitive markets are very rare and that in reality our product exists in a different type of market. The four types of markets are: Monopoly, Oligopoly, Monopolistic competition, and perfect competition. Our company has gained enough power in the market to influence price and allow it to choose its own optimal price. This means that establishing an equilibrium where QD = QS does not necessarily apply. Perhaps our company has developed an innovation that makes the quality of our microwave meal much better than our competitors or we have developed a process than drastically lowers the cost of processing the ingredients for our product. Regardless of the reason, our company now has a competitive advantage and we must take advantage of it in order to become dominant in our industry.

In a perfectly competitive market each firm is a “Price Taker” , i.e. the prices and wages are determined by the market and the firm is so small relative to the size of the market that they can have no influence over the market price. For a market to be

Competition being one of the major issues that often must be addressed in the business world, it is important for a firm to learn on ways to reduce the impact of the competition. Competition is definitely an important factor in helping a business

n perfectly competitive industries, there are such a large number of firms, each producing such a small proportion of the industry’s output, each firm cannot, by its own independent action, affect the supply or the price. The degree to which firms can influence the price of their product through their own strategy depends upon market structure. Perfectly competitive market structure is a market situation where there arelarge number firms producing a homogeneous productand there are large numbers of byers demanding the same products. In such a market every firm considers that it can sell any amount of output at the prevailing market price.Similarly, there is no restriction for the byers to purchase any amount from the

Competition is very large in the everyday business industry. One company is trying to beat the next company or top the next company. Competition in the businesses is the normal competition. Individuals must be building and have a strategic plan which needs to be unique and different. In large industries such as drink interesting are rapidly changing for the sake of the market place.

Competitive rivalry exists between companies with the same or similar products/services and similar markets. Factors to be considered include:

When the companies want to keep their development within the competitive economic environment, they should have a plan. This plan is not only integrate the condition that means the

Porter (1990) argued that if a nation can achieve competitive advantages, certain factors are required. He claimed a nation’s competitiveness should depend onhow its industries are innovating and upgrading. Nevertheless, advantages can gain through pressure and challenges, since if companies are having strong domestic rivals, aggressive home based suppliers and demanding local customers, they will needed to keep upgrading and innovating, as to hold the position. Furthermore, Porter (1990) indicated howa

The reasoning is, that in a perfectly competitive market a large number of sellers offer “homogeneous or undifferentiated products” (Perloff, p.220), thus the demand for these products or services is perfectly elastic as the consumer can easily substitute one firm’s for another. Consequently, each firm can sell its product or service at the market price but as soon as a firm raises the price, its customers would wander off to another supplier. In the supply and demand model an increase in prices can usually also be achieved by reducing production and therefore supply (Perloff, p.27). In a perfectly competitive market, however, there are no barriers to entry, which means that new firms could enter the market to satisfy the excess demand, thereby keeping the market price unchanged (Perloff, p.242). These conditions make the producer side a “price-taker”, which is the definition of a competitive market (Perloff, p.220), and certainly benefit the consumers, thus welfare indeed is maximized in a competitive market.

a) In a perfect competitive market, the sole determinant of pricing is the market demand and the supply curves. A demand curve refers to the total amount that consumers will pay for their products. The supply curve is the total amount that the producers can actually make to supply to the company at the price they can afford or are willing to pay. Another factor in a perfect competitive market structure is the equilibrium price which is basically when the supply of the market meets the market demand of the consumers. Anther unique feature of a perfect competition market is that it is a price taker. In essence, this means that the company doesn’t have any influence on the price. Again, this can only be caused through a market that has a large number of firms with identical products. (Samuelson and Marks, 2010).

The purpose of this sub-chapter - comparing the competitiveness of small and large firms is to determine how they are different and how they are competing in a global technology competition. I will try to explain the strategy and policy of firms, which define their competitiveness, the competition between small and large firms and also their position in a market. For this, it will be good to start from the theoretical side of competition between firms and then to continue with the real market competition and define the most successful companies. Also one of the aims of this research is to determine what setback they have and how firms can improve their strategies in terms of to gain success as much as possible.