Asked by AbasEconomics πŸ“ˆ

What are the benefits of having many different car manufacturers, instead of just one manufacturer that holds a pure monopoly in the market?

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Husain Mukadam

Make Learning Fun Again! MSc | BSc | 4yrs+ exp. | DBS Certifiedβœ”οΈ

Competition is a critical driver of performance and innovation. It benefits everyone by enabling us to choose from an wider choice of excellent cars at more affordable prices. Competition also encourages the adoption of innovation as companies evolve and new ideas flourish in the marketplace. E.g. now that Tesla has entered the car market, it is forcing other car manufacturers to build electric vehicles. These cars accelerate much faster, are environmentally friendlier, pioneers autonomous driving, cheaper to run, safer, & more reliable. There is no guarantee that a monopoly would have the will or incentive to innovate these ideas, especially if they make profit regardless ​ 

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