During the primitive times, barter was the means of trading. It was not even mere exchange of goods at that; there was an exchange of selves in a mythical bond. Then came the Greeks who exchange goods between consumers in agoras or their markets, an activity which values contemplation. During the medieval age, the value of work and trade was viewed as imitation of God’s creation, cultivating the virtue of industriousness. At what point are we now? Most trade just to earn profit. Money is all there is.
Before, competition was far from one’s intentions. Guilds were built in order for those who have the same interests and capabilities to group together and hone their skills for the good of society. There was equal opportunity for everybody. Yes, in this new age, competition is not bad provided that it is a healthy competition. Of course people would be motivated to discover new things, to make things more efficient, and to improve quality and quantity of products to one’s advantage if rivals exist.
A monopoly is one market system that has only one seller. Some monopolies are natural monopolies and are allowed to exist, while other monopolies are prevented by antitrust laws that prevent price-fixing and aggressive tactics that keep competitors from entering the market. Monopolies have its advantages. It can lower costs and save space. It can even help save the environment since no other firms need to use more land. However, it can also use its status in order to create a barrier for other new firms. It can even lower its price, given that it already has enough money saved up, so that buyers of the new firm will turn to toward it. Also, a total opposite of this is when a monopoly decides to raise its price. It would be a burden for consumers if the good is inelastic since they have no alternative. They would be forced to pay for the goods at their loss and the gain of the monopolists.
Monopolistic competition’s major disadvantage is that competing firms are inefficient and the prices of the products usually exceed the benefits or value provided by the products or services. Also, this kind of market system emphasize on advertisements and promotional strategies. Sometimes, enormous amounts of money are wasted just because of the “brand” names. These convince consumers that differences of same products exist when actually there are none. Some goods are expensive since some firms have already established a name. A part of the price consumers are paying include advertisement costs. It is somehow an implicit way for consumers to finance advertising. These kinds of activities of monopolistic competitors intend to change people’s preferences and to create wants that otherwise would not have existed. These would eventually lead to an unproductive warfare.
In Oligopoly, there are cases where producers will unite against potential new entries in the market by controlling price fixation and there by creating an acute loss of revenue for the new producers. When producers agree to increase the general price level, it could be favorable for them but this will also cause nightmares for consumers.
People will never be contented. When one want is satisfied, another takes its place. Many believe money makes the world go round. Some even wish for money to grow on trees. However, could money buy those which are really important for an authentic human existence?
