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Is "perfect competition" a valid concept?

asked Nov 04 '12 at 16:06

user890's gravatar image

user890
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edited Nov 04 '12 at 16:06

The very Wikipedia page you link to seems to admit that it is an empty concept. "Because the conditions for perfect competition are strict, there are few if any perfectly competitive markets."

And the Wikipedia is overly generous with its "few if any" description. Infinite buyers and sellers, zero entry and exit barriers, perfect factor mobility, perfect information, zero transaction costs, etc. This "concept" is a figment of the imagination of some economics students.

See also: http://archive.mises.org/19459/perfect-competition-gobble-degook/ or Capitalism by Reisman, pp. 430-432

(Nov 04 '12 at 22:07) anthony anthony's gravatar image

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Asked: Nov 04 '12 at 16:06

Seen: 1,120 times

Last updated: Nov 04 '12 at 22:28