I Need Help With A Discussion Question To Meet The Requireme

I Need Help With A Discussion Question To Meet The Requirements It M

The United States has a variety of regulations to address the economic harm resulting from monopoly power in an industry. This includes the Sherman Act of 1890, the Clayton Act of 1914, and the Federal Trade Commission Act of 1914. These acts were aimed at restricting the formation of cartels and monopolies to protect consumers and ensure competition.

The article The Oligopoly Problem argued that oligopolies fall through the cracks of these regulations and leave consumers unprotected from harmful business practices where industries are highly concentrated. Read the article and respond to the following in your initial post:

• What are examples of firms in an oligopolistic market that abuse their power? Explain how they abuse their power and describe the impact on consumers.

• Do you agree with the author’s feelings about increased government oversight of such industries? Why or why not?

• What are your views on increasing government oversight of oligopoly industries, and how might it affect competition and consumer welfare?

Paper For Above instruction

In oligopolistic markets, firms often wield substantial market power due to the limited number of competitors, which can lead to abusive practices that harm consumers. An illustrative example is the airline industry, which is characterized by a small number of large carriers such as American Airlines, Delta, and United Airlines. These firms occasionally engage in anti-competitive behaviors like price fixing, limiting service routes, or raising ticket prices during peak travel times. Such practices diminish consumer choice and inflate costs, undermining the benefits of a competitive market. Similarly, the technology sector, with giants such as Google, Apple, and Facebook, sometimes abuse their dominant positions by engaging in monopolistic tactics such as predatory pricing or suppressing competition through restricting access to platforms or data, which can stifle innovation and limit consumer options (Khan, 2017). The impact on consumers includes higher prices, reduced innovation, and fewer choices, compromising overall welfare.

The author’s argument for increased government oversight resonates strongly, as current regulations like the Sherman and Clayton Acts offer limited protection against the concentrated power of oligopolies. These laws primarily target overt collusion and monopolies but often fall short in addressing subtle anti-competitive strategies employed by large firms in highly concentrated markets (Stiglitz, 2019). I agree that stronger oversight, including stricter antitrust enforcement and regulations on mergers, can help curb abuses and promote competition. Enhanced oversight can lead to a more level playing field, fostering innovation, reducing prices, and safeguarding consumer interests. However, excessive regulation might also discourage investment and innovation if not carefully balanced. Therefore, a nuanced approach involving targeted regulation and vigilant enforcement is necessary to ensure that oligopolistic markets serve consumer interests without stifling economic growth (Baker, 2020).

References

• Baker, J. (2020). The Antitrust Paradigm: Restoring Competition and Protecting Consumers. Cambridge University Press.
• Khan, L. (2017). Amazon's Antitrust Paradox. The Yale Law Journal, 126(3), 710-785.
• Stiglitz, J. E. (2019). People, Power, and Profits: Progressive Capitalism for an Age of Discontent. W. W. Norton & Company.