The Comparison between Competition and Monopoly—Amendment of Market Structure and Firm Equilibrium Theory of Chamberlin and Robinson and Its Value for Industrial Policy

• 1、Management School of Ludong University

Abstract：Based on the criticism upon a series of defects of market structure and firm equilibrium theory of Chamberlin and Robinson and the resetting of practical premises, with the help of stationary equilibrium and dynamic equilibrium, the paper amends the market structure and firm equilibrium theory, reaching a conclusion as follows: From the static perspective, the best market structural form is not perfect competition but moderate competition. In specific instance, the moderate competition behaves as absolute monopoly; From the dynamic perspective, capital–intensive industries will quickly evolve to monopoly, and labor–intensive industries will come to oligopoly with a comparatively slow space. As a result, there is an evolutionary trend from competition to monopoly in national economy system. Based upon this conclusion, the government have to apply anti–monopoly policy which emphasizes being against actions of market monopoly and structures of administrative monopoly and merger policy sustaining medium and small enterprises in magnifying their scale.

Keywords： Market Structure Firm Equilibrium Model Amendment Industry Policy