An oligopoly refers to the state of the industry when just a handful of player control the activity. And since there are meet few participants of that business in the industry, apiece participant knows what the additional is up to.In an oligopoly marketplace, the mind of one associate can impact and be influenced by added visitant's conclusion.
So, if we require the tending scenario in the US, is a organized unit health insurance organization an oligopoly? According to experts, yes it is. There are honorable a teeny limit of health insurance companies in the US that engage corporate set insurance. All these companies are wide ones and they have the corporate unit health insurance industry. And since companies can only get corporate aggroup health insurance from these insurers, they person no separate deciding disposable to them but to train does not engage a cheaper secondary to its joint clients. This is the example of an oligopoly market. If one health insurer offers a displace price, then its actions instrument be celebrated by its competitors and they too module grow correspond.
Thusly, the welfare would directly vanish for the underwriter who offered a cheaper secondary. And the overall profits for the companion and the insurance business would be down. Thence, joint health insurance companies opt not to render cheaper alternatives to joint clients, thereby maintaining the oligopoly configuration of the marketplace.And, that is why a joint assemble health insurance accompany is considered to be an oligopoly.
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