The optimal market structure for technological advance seems to be an industry in which
A) most firms are purely competitive.
B) there is a natural monopoly with a large market for the product.
C) there are oligopolistic firms and several small and highly innovative firms.
D) the government provides some funding for research and development.

Question

Quizplus · Accepted Answer

In an industry with oligopolistic firms and several small and highly innovative firms, there is competition among firms that drives technological advancement, but there is also room for smaller firms to innovate and disrupt the market. This structure allows for a balance between competition and innovation, which ultimately benefits consumers and the economy as a whole. Additionally, government funding for research and development can further facilitate technological progress in this market structure.

The Optimal Market Structure for Technological Advance Seems to Be