there exists a fundamental contradiction in capitalist ideology: Competition is regarded as a virtuous necessity, but firms are driven to dominate particular industries in practice. explaine and analyze competition in Adam Smith and John Nash 's prespective.  long and explanatory, detailed answer please

Asked Dec 14, 2019

 there exists a fundamental contradiction in capitalist ideology: Competition is regarded as a virtuous necessity, but firms are driven to dominate particular industries in practice.


explaine and analyze competition in Adam Smith and John Nash 's prespective. 


long and explanatory, detailed answer please


Expert Answer

Step 1

Capitalism is defined as the economic system that would be based on the private ownership related to the means of the production along with the operation for profit. The general characteristics of capitalism would include private property, includes capital accumulation, wage labor, along with the voluntary exchange, has a price system along with the competitive markets.

The capitalist economy would have the main features such as the private property, it would include the price mechanism, having freedom of enterprise, having the sovereignty of consumer, should include a profit motive and it would have no government interference:

Step 2

Adam Smith's belief in the competition was every boy "in competition, individual ambition serves the common good".  It suggests, how the group of competitors firms should aim for the one sole target, goals and objectives, rather than focusing on them elsewhere. John Nash equilibria's decision making focuses on the dilemma along with achieving an interactive outcome that could risk a social catastrophe. In the competition, Nash explains how an individual firm would make a particular decision and how the decisions would be made after effect one individual to others.

It is true, that the companies are driven by competition and they woul...

Want to see the full answer?

See Solution

Check out a sample Q&A here.

Want to see this answer and more?

Solutions are written by subject experts who are available 24/7. Questions are typically answered within 1 hour.*

See Solution
*Response times may vary by subject and question.
Tagged in



Related Economics Q&A

Find answers to questions asked by student like you
Show more Q&A

Q: c) and d) please

A: * Solving only parts c and d as per requirement.The initial equilibrium is where aggregate demand (A...


Q: Consider the following:The US public debt now stands at approximately $22 trillion, making the count...

A: When the US central bank prints more money to pay off its debt then there is an increase in money su...


Q: Refer to the figure. Which statement is TRUE?     This consumer is indifferent between bundle...

A: The given figure shows the indifference curve of a consumer and it shows different bundles to show h...


Q: Causes and effects of low interest rates

A: The interest rate is determined by the intersection of demand and supply of loanable funds. It is no...


Q: There is a bar on Off‐Main Street called the Rock‐n‐Roll Bar. All the people that go to that bar lik...

A: The correct answer to the above-mentioned question is (C).


Q: The text notes that changes in oil prices can affect the inflation-unemployment outcome. Explain wha...

A: Fluctuation in oil prices have a direct impact on inflation. Generally the rise in prices of oil and...


Q: Which of the following would cause an increase in the equilibrium price of a good?    a. Fewer fi...

A: Demand: It refers to the quantity of a commodity that consumer is willing and able to purchase at gi...


Q: A perfectly competitive rm produces output q with capital K and labor L according to the production...

A: (d) We can calculate the value q at which the minimum of ATC occur as follows.


Q: True or False: Cost-push inflation is caused by a rightward shift in the short-run aggregate supply ...

A: Click to see the answer