Share one effect you think these types of firms have on the quality of goods or services that you purchase. Is the quality affected positively or negatively? Provide a rationale for your answer.
Monopolistic competitors have a positive effect on the caliber of products and services they provide. This is evident in branded clothing companies like Nike and Adidas. When one produces a shoe, for example, the other strives to produce a better shoe in order to increase its market opportunity and sell more than its competitor. This sees an increase in quality of goods produced in order to attract more buyers. A highly profitable monopoly affects the value of commodities and resources in a negative way (Belleflamme, & Peitz, 2015). This is because the company has no incentives to improve on any aspect of their service as long as consumers still have a great need for their current service as it is. The kind of laxity demonstrated is as a result of no pressure from any competition. Oligopoly has a positive impact on the caliber of products and resources provided. Companies within the oligopoly compete through innovation, technological advancements and general improvements on products and services.
