Throughout the United States, a myriad of market structures exist. For example, the monopolistic competition template is copious in number, while the oligopoly market structure tends to be rarer to find. Colgate and General Motors serve as excellent examples.
Colgate has been a successful seller of toothpaste for decades. Entrenched in a monopolistic competition market, there are many competitors selling a very similar product. Therefore, while market entry is not that easy, it’s certainly possible and happens often. A number of brands of toothpaste exist, so to attract customers, advertising is used widely. The cost of Colgate toothpaste has a slight dependence on competitor’s prices.
General Motors has long been in the oligopoly known as the automobile industry. With Ford and Chrysler as well, the three companies share an abundance of market power each, contributing to an atmosphere where a scant number of companies sell the same, if somewhat differentiated, product. Not enough power, however, to be complete price-setters. Market entry is heavily blockaded and difficult to overcome. To appease the volatility of consumer demand, General Motors often users tacit collusion to make fiscal decisions that concur with revenue goals.
Colgate and General Motors each have interactions unique to their economic system, due to the relative distribution of market power and competitors. Even so, both have made significant profit through their own unique methodologies, highlighting how having a variety of market structures with one overarching economy is definitely feasible.
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