Market Structure Essay Example | Topics and Well Written Essays - 1250 words

Market Structure - Essay Example What is also significant to understand that the article discusses how the services are packaged together with the goods to deliver a unique combination of offering to the consumers? This combination of selling the services and goods as the bundled products are changing the way traditionally goods and services are being offered. This article discusses also the strategies of the leading players in the market and how the competition between them is shaping the future of the industry. This paper will discuss the market structure described in the article, how the externalities, environmental policies as well as the public goods are being offered and finally how the production takes place and the relative costs associated with it. Market Structure This article discusses an industry which is an oligopoly in nature. Oligopoly is that form of market structure where the industry or the market is dominated by smaller number of sellers. (McEachern 2008). Since in oligopoly, there are smaller num ber of sellers therefore each participant in the market is aware of what other is doing and thus the decisions of one firm is either influenced by the decisions of other firms or its decision influence the players in the market. The overall strategic planning process of each of the player in the market therefore takes into account the actions and strategies of other players. (Bowles 2006). This article discusses as to how the Apple, through its products especially smartphones, MP3 players and tablet computers is influencing the market. It is also important to note that unlike other firms in the market, Apple is offering both the hardware as well as the software thus affecting and influencing the market from both the ends. It is also important to note that Apple and other producers in the market i.e. Microsoft and Google specially are the price setters in the market rather than price takers. Barriers to the entry in the market are high too owing to the high cost involved in the acqui sition of sophisticated technology as well as economies of scales involved due to sheer production of number of units by each of the player in the market. Apple and other firms in the industry also seem to capture the long run profits thus ensuring that the new entrants into the market cannot access to the abnormal profits in the long run. This ability of the firms like Apple has allowed it to set higher prices for its products such as Apple IPAD and IPODs. Externalities, environmental policies and Public goods Public goods, in economics, are considered as the goods which are non-rival as well as non-excludable. Non-excludable goods are those goods which create the problems of so called free riders wherein once the goods are produced, it is almost impossible to exclude the people from using them even if they have not paid for it. Further, the non-rival nature of the goods suggests that the consumption of goods by one individual does not reduce the quantity available for consumption to other consumers. (Baumol and Blinder 2008). Considering the above clarifications in mind, it is important to note that the article has discussed that Apple and other companies in the market are offering free public goods.