Running head: MARKET STRUCTURE AND PRICING POWER 1
MARKET STRUCTURE AND PRICING POWER
Roy Irving
ECO 561
May 30, 2016
Ali Boloorian
MARKET STRUCTURE AND PRICING POWER 2
Introduction
In the economics field, market power refers to the ability of a firm to control or adjust
prices of produced goods within the specific market of operation. Any firm that has strong
market power will be in a position to raise the prices without losing its customers. This paper
will analyze the automobile industry by studying the economic factors involved in its operational
dynamics. The auto industry is largely an oligopoly market.
Market structure
An oligopoly is a common market structure in the global domain, where a few players
have managed to overshadow other emerging firms. The characteristic that identifies this type of
market is that it is significantly jointed by few firms, though there are other small firms in the
