Differentiating Between Market Structures

Differentiating Between Market Structures
A. Clontz-Prater, C. Edwards, G. Sturdevant, T. Valentine
September 20, 2010
ECO/212
Shauna Whitcomb

Differentiating Between Market Structures

      To differentiate between market structures one must be able to determine whether a product is a public good, private good, common resource, or a natural monopoly. To differentiate between market structures it is also extremely important to have an understanding of how the labor market equilibrium is affected by the supply and demand of labor.
      To arrive at a better understanding of how to differentiate between market structures Team A has taken an in-depth look at the organization Verizon.   Verizon’s market structure has been evaluated to determine the effectiveness of its structure.   Additionally, the factors that affect Verizon’s labor supply and demand have been summarized below.
      Public Goods, Private Goods, Common Resources, and Natural Monopolies
      A public good is one that is available to the majority, and the consumption of it does not decrease the consumption of others. Telephone service providers such as Verizon Wireless are a fine example of a public good.   A private good is the opposite of a public good, therefore it is restricted and only few have access to it.   Public and private goods can be rivalrous or non-rivalrous, excludable or non-excludable.   Rivalrous means that there is a type of competition to having a vested interest in the good.   Excludable means that access to this item is not accessible to everyone.   Both types of goods can have four different access points.   They can be rivalrous and excludable, rivalrous and non-excludable, non-rivalrous and excludable, and non-rivalrous and non-excludable.

(Hubbard & O’Brien, Economics, p. 148)

As seen from the graph above, many of the items are things that most people use on a regular basis, especially private goods. Common resources are resources that are available to everyone....