Monopoly vs Monopolistic Competition: Difference and Comparison

In terms of market type, demand and supply chain, product diversity, pricing, ease of entry and exit from the market, predictability of the products, and so on, there is a distinction between monopoly and monopolistic competition.

Key Takeaways

  1. Monopoly is a market structure in which a single firm dominates and controls the product’s price.
  2. Monopolistic competition is a market structure in which many firms sell similar but slightly differentiated products.
  3. While monopoly and monopolistic competition involve market power, monopolistic competition allows for more competition and variety in the marketplace.

Monopoly Competition vs Monopolistic Competition

A monopoly exists when there is only one seller in a market, giving them complete control over the supply and price of the product or service they offer. Monopolistic competition exists when there are many firms in a market, each producing a slightly differentiated product. In this type of market, firms have some market power, but competition is still present.

Monopoly Competition vs Monopolistic Competition

There is no competition in a Monopoly type of competition since just one vendor sells or offers one specific product in the market. The market is dominated by a single player.

Monopolistic competition occurs when a single product is sold or offered by a large number of sellers in the market, resulting in significant market competition.

Comparison Table

Parameters of ComparisonMonopoly CompetitionMonopolistic Competition
Type of competition No competition Small competition
Type of Market One-seller market More than one seller is involved.
Demand and supply It solely depends on the seller. It can be controlled.
Predictability of product Highly predictable Highly unpredictable
Products Variety Variants may/may not exist, depends on the seller. Variants exist.
PricingDecided by the seller, buyers can’t interfere.Decided by mutual interaction of sellers and buyers.
Entry and exit Extremely difficult Moderately easy

What is Monopoly Competition?

There is no rivalry in a Monopoly type of competition because, in the market, only one specific product is sold or offered by a single vendor.

Also Read:  Step Sibling vs Half Sibling: Difference and Comparison

The vendor is the only one who sells the thing, just like in the market. Because there is no competition in a monopoly market, the sole seller has complete control over demand, supply, product kind and quantity, and price.

The demand and supply chain, however, is not the Seller side biassed due to the characteristics of the goods and commodities. It’s difficult to break into a monopoly market.

What is Monopolistic Competition?

Monopolistic competition occurs when a single product is sold or offered by a large number of sellers, resulting in significant market competition.

Small competition exists in the case of monopolistic competition. Despite the lack of rivalry, the level of competitiveness is insufficient to change or alter the general demographics.

Control over demand and the supply chain can be quickly regained under a Monopolistic kind of market completion. A monopolistic market is easier to enter and depart than a competitive market.

Main Differences Between Monopoly and Monopolistic Competition

  1. Entering into a monopoly type of market is challenging. So is the exit. On the other hand, both entry and exit from a monopolistic type of market are comparatively easier.
  2. In a monopoly type of market competition, the predictability of the products is highly predictable as only one seller is present. On the other hand, in a monopolistic type of market competition, any predictions on the products in highly unpredictable.
References
  1. https://link.springer.com/chapter/10.1007/978-1-349-19802-3_23
  2. https://onlinelibrary.wiley.com/doi/abs/10.1111/poms.12373

Last Updated : 14 August, 2023

dot 1

26 thoughts on “Monopoly vs Monopolistic Competition: Difference and Comparison”

  1. The detailed analysis of monopoly and monopolistic competition in the article is commendable. It offers a clear understanding of the nuances of market structures.

    Reply
  2. The distinction between monopoly and monopolistic competition is articulated very well in the article. I appreciate the clarity and depth of the content.

    Reply
  3. The article effectively illustrates the key differences between monopoly competition and monopolistic competition, which will be very helpful for students and researchers.

    Reply
  4. This is a great breakdown. The comparison table is particularly useful to differentiate between monopoly competition and monopolistic competition.

    Reply
  5. This is very informative. I think the distinction between monopoly and monopolistic competition is essential when studying the dynamics of market structures.

    Reply
  6. The detailed explanations and examples provide a clear understanding of the two market structures. It’s a valuable resource for anyone studying economics.

    Reply
  7. The article effectively outlines the key differences between monopoly and monopolistic competition. The comparison table makes it easy to grasp the distinctions.

    Reply
  8. The article provides a comprehensive comparison and explanation of monopoly and monopolistic competition. It’s a valuable resource for anyone studying economics.

    Reply
  9. The article is very clear about the difference between monopoly and monopolistic competition. I’m going to use it as a reference for my next economic paper.

    Reply
  10. This article provides a thorough comparison and explanation of monopoly competition and monopolistic competition. It’s an excellent resource for anyone interested in economics.

    Reply

Leave a Comment

Want to save this article for later? Click the heart in the bottom right corner to save to your own articles box!