This exposed them to swings in the economy, as they were so large that they were a major player inside the sector. While at the same time, many of the different elements of perfect competition existed. This is significant, because it shows how the overall model has been changing. At which point, many competitors have been adapting to: these shifts and are using tactics that are increasing their risks. In many ways, one could argue that the new definition has meant that these organizations are not experiencing perfect competition. Instead, they are engaging in activates that will increase their overall exposure to host of events (that are disguised as perfect competition). This has led directly to the shifts in this definition, which have caused different economic calamities (i.e. The financial crisis).
Clearly, the definition of perfect competition has been continually evolving over the last several decades. This is because globalization and improvements in technology have meant that there were changes in these views. as, these two factors are working together to: influence how consumers and businesses are interacting with each other. This has led directly to shifts in the way many corporations are: viewing perfect competition and how they fit in line with this definition. Where, a variety of organizations have been seeking out new ways to maximize their profits based upon these changes. This has caused many executives to begin to engage in actions that will harm their business model.
What they are doing is following the definition of perfect competition...
Our semester plans gives you unlimited, unrestricted access to our entire library of resources —writing tools, guides, example essays, tutorials, class notes, and more.
Get Started Now