Differentiate between Monopolistic Competition and Imperfect Competition

Here, we Understand the Differentiate between Monopolistic competition and Imperfect competition in detailed.

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Differentiate between Monopolistic Competition and Imperfect Competition:

Now we will discuss first about Monopolistic Competition:

This Concept is developed by the American Economist named Chamberlin during early thirties.
It is a specific market situation which is a mixture of the elements of both monopoly and competition.
It is a part of Imperfect competition. It is a narrow concept.
The concept of monopolistic competition as developed by Chamberlin focuses on monopoly creating elements like trade mark, patents, brand name, labels etc.
Under monopolistic competition, Product differentiation and selling cost (Advertisement) etc. occupy great importance.
Here there are many firms, yet each firm has its impact and its importance.
Chamberlin has used the concept of group in place of industry. Group means sum total of firms producing fairly close substitutes.

Now we will discuss about Imperfect Competition:

This concept is developed by Mrs. Joan Robinson of England about the same time.
It refers to markets that lie between two ends namely perfect competition at one end and monopoly on other end. There may be many market situations.
It is more comprehensive or inclusive concept. It is wider than the concept of monopolistic competition.
The concept of imperfect competition as propounded by Joan Robinson pinpoints elements that create imperfections in the market viz., ignorance, inertia, immobility etc.
Imperfect competition refers to different degrees of imperfections in various market situations. Product differentiation is not discussed here by Joan Robinson.
Imperfect competition includes markets like duopoly, oligopoly, also there is no sanctity about the number of firms.
Mrs. Joan Robinson's concept of imperfect competition needs no concept of group as it includes many types of markets viz duopoly, oligopoly and monopolistic competition also.

Monopolistic Competition- Differentiate between Monopolistic Competition and Imperfect Competition.

Kinnari

Tech writer at NewsandStory