Free Market Competition Vs Monopolistic Competition

There are two different types of competition in a market, monopolistic competition and free competition or also known as perfect competition. An example of a monopolistic competition or monopoly is the market in China, where only one company or firm distributes resources and good. An example of a perfect competition is the United States or Singaporean market in which people are free to enter or exit the market. The question is, is a free market competition better than a monopolistic market competition? A free market competition is better than a monopolistic competition because there is little constraint for people to enter or start a business in the market and consumers are able to set the price based on the demand vs. supply concept. A clear

The type of economy a communist country would have would be considered a command economy. In a command economy only a few people owns the resources, whereas in a free market economy the people have the right to own resources. In a market economy people can live their life the way they wish. The type of economy has a huge influence on the type of government. In a command economy, the market can control the goals of the economy. An example is how in a command economy, all resources can be used to developing military weapons, while in a free market resources are used to make a profit and benefit both the producers and consumers. “A command economy is hence a creature of state authority, whose marks it bears and by whose hand it evolves, exists, and survives. Command economies are imposed, whether through external duress or imitation, or indigenously in order to achieve specific purposes such as: (1) maximum resource mobilization towards urgent and over-riding national objectives, e.g. rapid industrialization or the prosecution of war; (2) radical transformation of the socio-economic system in a collectivist direction based on ideological tenets and power-political imperatives; and (3) not the least, as an answer to the disorganization of a market economy through price control, possibly occasioned by inflationary pressure arising from (1) and/or (2).” (Richard E. Ericson 02) A monopoly, where there is no market competition, can concentrate on selling goods that benefits the government, while in a free market that has many competition goods and services can be produced to benefit all