In an oligopoly, minimum efficient scale is likely to occur at a level of output that is a large fraction of industry sales.

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In an oligopoly, there are only a few firms that dominate the industry, and they often have significant market power. As a result, minimum efficient scale (MES), the level of output where economies of scale are fully realized, is likely to occur at a high level of production. This is because the dominant firms can take advantage of their market power to achieve economies of scale at a higher level of output than in a more competitive market. As a result, MES is likely to be a large fraction of industry sales in an oligopoly.

In an Oligopoly, Minimum Efficient Scale Is Likely to Occur