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REALISM OF PERFECT COMPETITION: Perfect competition is an idealized market structure that does NOT exist in the real world. While some real world industries might come relatively close to a one or two of the four key characteristics of perfect competition, none matches all four sufficiently that we can declare a perfectly competitively industry. Some industries come close on the large number of small firms and the identical product characteristics. A few industries have relatively good, although not perfect, information about prices and technology. However, almost all industries fall far short of the perfect mobility characteristics.
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                           SELLERS' MARKET: A disequilibrium condition in a competitive market that has a shortage or excess demand. Because the quantity demanded is greater than the quantity supplied, sellers have the "upper hand" when negotiating. A sellers' market also goes by the more common term of shortage. The alternative to a sellers' market is a buyers' market, which has a surplus or excess supply. A sellers' market exists because the quantity demanded by the buyers exceeds the quantity supplied by the sellers... at a given market price. In this situation, buyers seek to buy more of the good than sellers are willing to sell, hence sellers can pick and choose whom they sell to among prospective the buyers. Buyers are lucky to find a good to purchase.| Sellers' Market |  |
A sellers' market is illustrated by the market for 8-track tapes displayed in this exhibit. This graph was generated with data from the 88th Annual Trackmania 8-Track Tape Collectors Convention at the Shady Valley Exposition Center.Sellers have the "upper hand" in this market due to the excess demand of 8-track tapes. This shortage is indicated as the difference between the quantity demanded and the quantity supplied at the designated market price. In particular, the 30-cent price generates a quantity demanded of 600 tapes and a quantity supplied of 200 tapes. Buyers are willing and able to buy 400 tapes more than sellers are willing and able to sell. This excess demand of 400 tapes is what gives the sellers the upper hand. Note that a sellers' market does not mean the lack of competition among suppliers have given some sellers market control. A sellers' market is a competitive market that simply has a temporary imbalance between the quantity demanded by the buyers and the quantity supplied by the sellers. A change in the market price would eliminate the sellers' market, and possibly even create a buyers' market.
Recommended Citation:SELLERS' MARKET, AmosWEB Encyclonomic WEB*pedia, http://www.AmosWEB.com, AmosWEB LLC, 2000-2025. [Accessed: July 15, 2025].
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PINK FADFLY
[What's This?]
Today, you are likely to spend a great deal of time flipping through mail order catalogs hoping to buy either a flower arrangement for that special day for your mother or a New York Yankees baseball cap. Be on the lookout for letters from the Internal Revenue Service.
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The Dow Jones family of stock market price indexes began with a simple average of 11 stock prices in 1884.
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"The time to repair the roof is when the sun is shining." -- John F. Kennedy, 35th U. S. president
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CES
Constant Elasticity of Substitution
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