Market Structure (The Video Series) - Perfect Competition

Hi Everyone,

I am bringing my market structure series to video. I have seven written posts on market structure. Not everyone prefers the written format so I am covering the same topics on video.

Quick Summary of the main points in the video

This video explores perfect competition. Perfect competition is one of the most discussed market structures in mainstream economics. It is normally the first market structure taught in economics courses. Ironically, perfect competition has very few real life examples. It can be considered more of theoretical framework than an example of a real world market structure.

Perfect competition has the following characteristics:

Many buyers
Many sellers
Homogeneous products
No barriers to entry
Firms are price takers not price setters
Normal profits in both the short-run and long-run
Allocative efficient price and quantity can be achieved
Buyers and sellers have perfect information regarding products and cost structures

Perfect competition is often used as an assumption in economic modelling to simplify the creation of the models. Perfect competition also sets a good framework for understanding the outcomes from purely competing on price.

I hope you enjoy the video.

All of my written market structure posts can be accessed using the following links.

Introduction to market structure written post can be accessed using the following link.