Oligopoly 寡头垄断: 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. 一种市场结构，少数公司在市场上占有很大份额。只有在这种市场结构中，你才有可能看到博弈论的应用。
Characteristics 特点:
§ Market dominated by a few large firms 由少数大公司主导的市场
§ Therefore high concentration ratio. 因此，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（不影响市场价格）。
§ Product differentiation occurs (products are not the same and therefore firms have some control over price. 出现产品差异化（产品不一样，因此企业对价格有一定的控制。
§ There is a lot of non-price competition 存在大量的非价格竞争
§ There are significant barriers to market entry (High sunk costs) – Stops new competition entering 有重大的市场进入障碍（高沉没成本）--阻止新的竞争进入
§ Interdependency – Collusive behaviour 相互依赖--合谋行为
§ Long run and short run supernormal profits 长期和短期的超常利润
§ Allocatively and productively inefficient, therefore don’t charge lowest price and don’t supply as much as they could. 竞争者在分配和生产方面效率低下，因此不收取最低价格，也不提供尽可能多的供应。
Due to high barriers of entry they will continue to maintain these supernormal profits.由于进入壁垒高，他们将继续保持这些超常的利润。
How the market operates 市场如何运作:
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.
价格倾向于长期稳定，有周期性价格战的倾向。削减价格以窃取市场份额。如果企业不断削减价格，最终的结果是对所有企业都有损害）收入甚至利润的巨大下降），一些企业将倒闭，只有最富有的企业才能生存。因此，与其在价格上竞争，企业将使用非价格竞争，如品牌、质量、广告、售后服务等。
The only reason to decrease the price (as it makes TR↓) is to gain market share and long term become the dominant market.
降低价格的唯一原因（因为它使TR↓）是为了获得市场份额，并长期成为市场的主导者。
At MC it doesn’t matter if you are more or less efficient as MR’s output is the same.
在MC，你的效率高还是低并不重要，因为MR的产出是一样的。
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
这种结果发生在市场上有一家占主导地位的公司。通常拥有比其他公司更大的市场份额和非常强的品牌忠诚度。这样的特点给了这个边缘人市场权力。如果它改变其价格，其他公司也会跟着改变
§ Reduces prices 降低价格: As it is the strongest brand other firms will lose market share if they do not follow. 由于它是最强的品牌，其他公司如果不跟随，将失去市场份额。
§ Increases prices 提高价格: 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. 市场领导者不会因为涨价而大幅减少其市场份额，因为它有品牌忠诚的消费者，他们的需求是没有弹性的。因此，其他公司不会因为不提高价格而获得更多的客户，并失去了可以通过提高价格获得的额外收入。
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.
当企业达成联合协议，限制产量和提高价格，以实现其联合利润最大化时，就会发生串通。为了使合谋有效，市场上的大多数公司必须达成一致，否则那些不同意的公司会压低合谋者的高价，并夺取他们的市场份额和超常利润。
§ Explicit Collusion (Cartel) 明确串通（卡特尔） – 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. -有一个正式的协议，限制产量，提高价格，由一群生产者组成。欧佩克是一个著名的卡特尔的例子。卡特尔通常不会持续到长期，对于个别成员来说，总是有欺骗的诱惑。第一个打破价格协议并降低价格的公司将从其他公司那里窃取大量市场份额
§ Implicit (tacit) collusion 隐性（默契）合谋 – Informal agreement and no communication between firms, but prices remain higher than they would with competition. 企业间的非正式协议和没有沟通，但价格仍然高于竞争时的价格。
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.
串通将导致比竞争市场更低的产出和更高的价格。因此，会有消费者剩余的损失，被称为社会的死重损失。
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.
勾结被认为是对消费者的剥削，以赚取超常的利润。因此，它在英国和美国都是非法的。竞争委员会等公司对英国市场的这种反竞争行为进行调查。它有权力阻止这些行为。
Collusion 勾结
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.
勾结通常是走向联合利润最大化的一种方式。如果被认为是 "任何被认为违反公共利益的行为"。然而，这都是规范的经济学。
– Most collusive activity takes place between firms in the same industry 大多数勾结活动发生在同一行业的公司之间。
– Vertical restraints refers to the methods used by manufactures to restrict the ways in which retailers can market their product. 纵向限制是指制造商用来限制零售商销售其产品的方法。
1) There are only a small number of firms – greater market share, less risk of disagreements. 只有少数公司--市场份额更大，出现分歧的风险更小。
2) The industry has substantial entry barriers – you want fewer firms to more barriers are good. Keep dominant firms dominant. 行业有大量的进入壁垒--你希望更少的公司，更多的壁垒是好事。保持优势企业的主导地位。
3) Large number of customers – the firms have more customers to sell to. 客户数量多--企业有更多的客户可以销售。
4) Low YED, demand inelastic YED低，需求无弹性
5) Firms output can be easily monitored. 企业产出容易被监控
6) Price discounts are harder to deliver 价格折扣更难实现
§ Horizontal collusion lead to increased R/D 横向串通导致R/D增加
§ Price Stability 价格稳定
§ Reduces wasteful costs of advertising 减少浪费的广告费用
§ Guaranteed supply from the producer cartel 生产者卡特尔的供应保证
§ LEDC’s may use cartels as growth strategies to help exports. LEDC可以利用卡特尔作为增长战略来帮助出口。