Question

In: Economics

PROMPT:  The author offers what he claims to be a simple proposal on how regulators should think...

PROMPT:  The author offers what he claims to be a simple proposal on how regulators should think about concentrated industries: “…when members of a concentrated industry act in parallel, their conduct should be treated like that of a hypothetical monopoly.”


Explain why you believe that members of a concentrated industry should or should not be considered similar to a monopoly.

Comment on whether there is in fact a problem that needs to be resolved if firms in the same industry happen to independently reach the same decision regarding product characteristics and price.

Solutions

Expert Solution

Answer

Yes I believe that the members of a concentrated industry should be considered similar to a monopoly because there has been a rise in the sales concentration withing the 4 digit industries across the US private sectors.Also the concentration levels has rise in about 75 % of the industries in the recent 20 years According to the measure of the memebr of concentrated industry , the concentration measure for the examination of about 20 company in any industry shows a bigger rise inn the concentration than the other broader measures.Also largest firm is the higher concereation driven which become largely thyan before , which simply means a monopoly or dominating market .The leading firms in the industry operates in less other dicrete 4 digit industries today compared to 1980s .In different word we can say that the top firms has tending to start to increase by specializing themselve to a core product markets.Therefore I believe that he members of a concentrated industry should be considered similar to a monopoly

HAVE A GOOD DAY !


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