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The effect of competition on service delivery |
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In a free market economy such as Australia, it is considered beneficial for consumers to be able to choose among a number of service providers or to be able to select from a range of alternative products. The availability of alternative products or services in the market place creates competition among suppliers and this competition works in favour of the consumer via the two following mechanisms: |
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| These benefits
for consumers underlie the reasons why governments in free market
economies seek to reduce the occurences of monopolies (Collins
dictionary defines a monopoly as occurring when an enterprise
or person has exclusive control of the market supply of a product
or service).
However despite the tendency for highly competitive markets to pressure suppliers into improving their products and pursuing cost minimization, there is a likelihood of this competition to have the following effects: |
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