Title: Why Perfect Competition Usually Does Not Happen
Headings: 7.1
Why Perfect Competition Usually Does Not Happen

7.1 Why Perfect Competition Usually Does Not Happen
Content: In the process of dealing with some perceived issues in these markets, these agencies will often block free entry of new firms and free exit of existing firms. In our complex technological world, perfect information among all sellers and buyers is not always a reasonable assumption. Some sellers may possess special knowledge that is not readily known by their competition. Some producers may have protection of patents and exclusive rights to technology that gives them a sustained advantage that cannot be readily copied. On the buyer side, consumers usually have a limited perspective on the prices and products of all sellers and may not always pay the lowest price available for a good or service (although the Internet may be changing this to some degree). Finally, for the perfect competition model to play out according to theory, there needs to be a reasonable level of stability so that there is sufficient time for the long-run consequences of perfect competition to occur. However, in our fast-changing world, the choices of goods and services available to consumers, the technologies for producing those products and services, and the costs involved in production are increasingly subject to rapid change. Before market forces can begin to gel to create price competition and firms can modify their operations to copy the most successful sellers, changes in circumstances may stir enough such that the market formation process starts anew.