Oligopoly 寡頭壟斷: A market structure with few firms having large shares of the market. It is only in this market structure that you are likely to see game theory being applied. 一種市場結構，少數公司在市場上占有很大份額。隻有在這種市場結構中，你才有可能看到博弈論的應用。
Characteristics 特點:
§ Market dominated by a few large firms 由少數大公司主導的市場
§ Therefore high concentration ratio. 是以，集中率高。
§ Small firms exist but are insignificant (don not affect the market price) 小公司存在但不重要（不影響市場價格）。
§ Product differentiation occurs (products are not the same and therefore firms have some control over price. 出現産品差異化（産品不一樣，是以企業對價格有一定的控制。
§ There is a lot of non-price competition 存在大量的非價格競争
§ There are significant barriers to market entry (High sunk costs) – Stops new competition entering 有重大的市場進入障礙（高沉沒成本）--阻止新的競争進入
§ Interdependency – Collusive behaviour 互相依賴--合謀行為
§ Long run and short run supernormal profits 長期和短期的超常利潤
§ Allocatively and productively inefficient, therefore don’t charge lowest price and don’t supply as much as they could. 競争者在配置設定和生産方面效率低下，是以不收取最低價格，也不提供盡可能多的供應。
Due to high barriers of entry they will continue to maintain these supernormal profits.由于進入壁壘高，他們将繼續保持這些超常的利潤。
How the market operates 市場如何運作:
Prices tend to be stable for long periods of time, with a tendency to periodic price wars. Cuts in prices to steal market share. If firms keep cutting their prices the end result is damaging to all firms) huge drops in revenues and even profits), some will go out of business, only the richest firm will survive. Therefore rather than compete on price, firms will use non-price competition such as branding, quality, advertising, after sales service, etc.
價格傾向于長期穩定，有周期性價格戰的傾向。削減價格以竊取市場佔有率。如果企業不斷削減價格，最終的結果是對所有企業都有損害）收入甚至利潤的巨大下降），一些企業将倒閉，隻有最富有的企業才能生存。是以，與其在價格上競争，企業将使用非價格競争，如品牌、品質、廣告、售後服務等。
The only reason to decrease the price (as it makes TR↓) is to gain market share and long term become the dominant market.
降低價格的唯一原因（因為它使TR↓）是為了獲得市場佔有率，并長期成為市場的主導者。
At MC it doesn’t matter if you are more or less efficient as MR’s output is the same.
在MC，你的效率高還是低并不重要，因為MR的産出是一樣的。
This outcome occurs when there is one dominant firm in the market. Usually with a larger market share that the others and very strong brand loyalty. Such characteristics give this frim market power. If it changes its prices other firms will follow
這種結果發生在市場上有一家占主導地位的公司。通常擁有比其他公司更大的市場佔有率和非常強的品牌忠誠度。這樣的特點給了這個邊緣人市場權力。如果它改變其價格，其他公司也會跟着改變
§ Reduces prices 降低價格: As it is the strongest brand other firms will lose market share if they do not follow. 由于它是最強的品牌，其他公司如果不跟随，将失去市場佔有率。
§ Increases prices 提高價格: The market leader will not significantly reduce its market share with a price increase as it had brand loyal consumers who have inelastic demand. Therefore other firms do not gain any more customers by not raising prices and lose out on the extra revenue that could be gained with higher prices. 市場上司者不會因為漲價而大幅減少其市場佔有率，因為它有品牌忠誠的消費者，他們的需求是沒有彈性的。是以，其他公司不會因為不提高價格而獲得更多的客戶，并失去了可以通過提高價格獲得的額外收入。
Collusion occurs when firms make joint agreements to restrict output and increase price in order to maximise their joint profits. For collusion to be effective the majority of the firms in the market must be in agreement, otherwise those who do not agree will undercut the high prices of those colluding and take their market share and their supernormal profits.
當企業達成聯合協定，限制産量和提高價格，以實作其聯合利潤最大化時，就會發生串通。為了使合謀有效，市場上的大多數公司必須達成一緻，否則那些不同意的公司會壓低合謀者的高價，并奪取他們的市場佔有率和超常利潤。
§ Explicit Collusion (Cartel) 明确串通（卡特爾） – There is a formal agreement to restrict output and raise prices by a group of producers. OPEC is a famous example of a cartel. Cartels do not usually last into the long run, there is always the temptation to cheat for individual members. The first firm to break the price agreement and reduce prices will steal significant market share from the others. -有一個正式的協定，限制産量，提高價格，由一群生産者組成。歐佩克是一個著名的卡特爾的例子。卡特爾通常不會持續到長期，對于個别成員來說，總是有欺騙的誘惑。第一個打破價格協定并降低價格的公司将從其他公司那裡竊取大量市場佔有率
§ Implicit (tacit) collusion 隐性（默契）合謀 – Informal agreement and no communication between firms, but prices remain higher than they would with competition. 企業間的非正式協定和沒有溝通，但價格仍然高于競争時的價格。
Collusion will result in lower output and higher prices than a competitive market. There will therefore be a loss of consumer surplus, known as a dead weight loss to society.
串通将導緻比競争市場更低的産出和更高的價格。是以，會有消費者剩餘的損失，被稱為社會的死重損失。
Collusion is deemed to be exploitation of the consumer in order to make supernormal profit. Therefore it is illegal in the UK and the USA. Firms such as the competition commission investigate UK markets for such anti-competitive practices. It has the power to prevent them.
勾結被認為是對消費者的剝削，以賺取超常的利潤。是以，它在英國和美國都是非法的。競争委員會等公司對英國市場的這種反競争行為進行調查。它有權力阻止這些行為。
Collusion 勾結
Collusion is often a way to move towards joint profit maximisation. If is seen as “anything deemed against the public interest”. HOWEVER this is all normative economics.
勾結通常是走向聯合利潤最大化的一種方式。如果被認為是 "任何被認為違反公共利益的行為"。然而，這都是規範的經濟學。
– Most collusive activity takes place between firms in the same industry 大多數勾結活動發生在同一行業的公司之間。
– Vertical restraints refers to the methods used by manufactures to restrict the ways in which retailers can market their product. 縱向限制是指制造商用來限制零售商銷售其産品的方法。
1) There are only a small number of firms – greater market share, less risk of disagreements. 隻有少數公司--市場佔有率更大，出現分歧的風險更小。
2) The industry has substantial entry barriers – you want fewer firms to more barriers are good. Keep dominant firms dominant. 行業有大量的進入壁壘--你希望更少的公司，更多的壁壘是好事。保持優勢企業的主導地位。
3) Large number of customers – the firms have more customers to sell to. 客戶數量多--企業有更多的客戶可以銷售。
4) Low YED, demand inelastic YED低，需求無彈性
5) Firms output can be easily monitored. 企業産出容易被監控
6) Price discounts are harder to deliver 價格折扣更難實作
§ Horizontal collusion lead to increased R/D 橫向串通導緻R/D增加
§ Price Stability 價格穩定
§ Reduces wasteful costs of advertising 減少浪費的廣告費用
§ Guaranteed supply from the producer cartel 生産者卡特爾的供應保證
§ LEDC’s may use cartels as growth strategies to help exports. LEDC可以利用卡特爾作為增長戰略來幫助出口。