Control Over Price

Definition

Control over price refers to the ability of firms or individuals to influence or determine the prices of goods or services in a market.

Analogy

Think of buying concert tickets online. If you see that there are only a few tickets left for sale, you might be willing to pay more than face value because you know someone else might snatch them up if you don't act quickly. In this case, you have some control over determining how much you're willing to pay for those tickets.

Related terms

Monopoly Power: When a single firm has significant control over pricing within an industry due to barriers preventing competition.

Oligopoly: A market structure characterized by few dominant firms that can exert some influence on prices due to limited competition.

Monopolistic Competition: A market structure with many sellers producing differentiated products allowing them some degree of control over prices through product differentiation.