The Organization of Industry

The organization of industry refers to how businesses and companies are arranged within a specific sector or market. It involves aspects like the number of firms (e.g., many small businesses or a few large corporations), the level of competition, and how products or services are distributed. This structure can influence prices, innovation, and consumer choices. Common industry structures include perfect competition, monopolistic competition, oligopoly, and monopoly, each with different characteristics of market power and entry barriers. Understanding industry organization helps analyze market behavior and informs strategies for businesses and policymakers.