A few days ago
why is competition an important element in a free-market system?
why is competition an important element in a free-market system?
Top 3 Answers
A few days ago
Favorite Answer
Because it leads to a drives the process.
BUT – there is a curious misconception. Anti-socialists believe that it is wrong for the government to become involved. That somehow it is wrong to have a federal government with an R&D department, totally self-funded, developing new drugs in competition with J&J P&G etc.
It is critical to have the government as a driving force in free enterprise, because THEY can deliver AT COST – they have no need to make a profit. Consequently, competitors must reduce costs and/or innovate, in order to compete.
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A few days ago
Because competition drives down prices. If only one company sold electronics in this country – as an example – there would be no sales promotions to attract buyers.
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A few days ago
Too much competition can drive prices down, too little competition can let them rise to unrealistic heights.
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