1.1. Introduction to Competitive Output

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From the course by University of Illinois at Urbana-Champaign

Microeconomics Principles

615 ratings

University of Illinois at Urbana-Champaign

Microeconomics Principles

615 ratings

This course offers an introduction to the functions of individual decision-makers—both consumers and producers—within the larger economic system. Emphasis is on the nature and functions of product markets, the theory of the firm under varying conditions of competition and monopoly, and the role of government in promoting efficiency in the economy. Most people make the incorrect assumption that economics is ONLY the study of money. My primary goal in this course is to shatter this belief. During this course, we will be addressing the above questions as well as many more relating to: -the environment -love and marriage -crime -labor markets -education -politics -sports -business My main goal is to show you the way economists think and how to use this analytical system to answer questions related not only to these and other important human issues, but to anything you end up doing with your life after this class. After all, as you will quickly find out, I believe that everything is economics!

From the lesson

Competitive Output

Welcome to your sixth week! This module we continue our discussion of the firm by focusing on those firms working in a perfectly competitive (or competitive) environment.

1.1. Introduction to Competitive Output2:46

Meet the Instructors

Dr. José J. Vázquez-Cognet
Clinical Professor
Department of Economics

[music] Welcome to Week 6 of my Microeconomics principles.

I am talking to you here from the Research Park at the University of Illinois in

Urbana-Champaign. I thought this was a good place to start

Week 6 when we talk about competition, because a Research Park is basically an

association the University has with many different companies in order to allow them

to operate at a low cost, by sharing some of their resources or inputs they need.

For instance, in this building we have right now, we have companies such as

Yahoo, John Deere, chemical companies like Dow Chemical, ADM Sierra Ventures Capital

Industry cinema industries, Dreamscape Cinema statistical in Strata, Caterpillar,

so, so I know many others that are kind of spread out in six or different, or seven

different buildings in this part of the campus.

And it's, it's, it's interesting and it's relevant because what these companies can

do by kind of being in this so-called incubators, is to share some of the

administrative costs secretary stuff, and in order to cut costs, and also they're

able to communicate better with each other, since they are so integrated,

right? A company like Yahoo might actually need

to coordinate their productions or, or services with a company like Strata that

provides you know, statistical services, and so forth.

So, what are we going to do this week? Well, first, we're going to talk a little

bit about market structure and the different type of market structure we can

talk about and how that influence the, the, the opportunity a company has for

pricing. And then, we focus our models, our

concepts on the market structure called perfect competition.

We basically said that the only way that companies can compete with each other is

by trying to cut cost and be the most effect, efficient that they can.

And when that situation occur, is where we have that idea of the survival of the

fittest in the business world. And where companies trying to make

themselves better off by trying to cut costs, and this is a good example of that,

of places like this. They actually drive technology down up,

and make products a lot cheaper for consumers.

So, we talked about at the end of the of the, of the week, about the long-run

competitive equilibrium model. So, we'll be back here at the end of the

week to kind of answer the question we established at the beginning of the week,

which is how computer power has gotten so, so good and so cheap, in so few, in so

little time. [music] Produced by OCE Atlas Digital

Media at the University of Illinois, Urbana-Champaign.

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