I want to start with a definition to understand what competition is?
Competition (lat. concurrentia, from lat. concurro - running, colliding) - struggle, rivalry in any area. Competition exists wherever there are two entities offering the same services or goods on the market. Now let's look at the role of competition in two areas: life and economics.
The role of competition in human life. Competition pursues us wherever there is at least some kind of relationship.
Let's learn about the role of competition in some life situations.
Job. Here we compete using our abilities and skills. For example, a tender is announced for the best commercial. Creative teams from various companies begin to come up with and then implement all their ideas. The role of competition in this case is stimulating and develops people’s abilities.
School. At school we compete with knowledge. For example, you need to write a very important report on physics for a school competition, and this is where the role of competition comes into play. It spurs and stimulates participants in the competition to win. On the one hand, this is good, the participants work hard and strive for a given goal. But there is another side: often, in order to win, competition participants act in dishonest ways or quarrel with friends who are participants in the same competition.
Show Business. Here we compete using our skills, talents or appearance. For example, the international music competition Eurovision is held every year. First, a selection is carried out in the country. Participants compete, showing what they are capable of and ready to do in order to win. Then there is a competition between European countries. The countries here are represented by those participants who withstood this competition and showed their abilities the most. And the winner is the most competitive and talented participant.
Let's move on to the role of competition in the economy.
Competition, in an economic sense, is a form economic relations between subjects of a market economy, which expresses competition for the most favorable conditions for the production, sale and purchase of goods or services. This is a cruel and conflicting method of interaction market subjects: achievement by an entrepreneur of his goals at the expense of other entrepreneurs.
Competition in the economy exists only in the market economic system. Competition in the market of various producers of the same product or service forces them to develop their technologies and improve the quality of production, but only if it is controlled competition. If it is not controlled, then manufacturers are ready to do anything to be better, while the quality and prices of goods or services often leave much to be desired.
Competition in the economy plays a motivational role; it stimulates the entrepreneur to take risks and fight.
Competition also plays the role of a regulator. It dictates to producers what needs to be produced for the consumer, because entrepreneurs mainly compete for the attention of the consumer.
Competition also plays the role of control. Competition limits and controls the economic power of each enterprise. Competition leaves the buyer the right to choose among several sellers. The more perfect the competition, the fairer the price for a product or service.
Conclusion: competition plays a huge role both in the economy and in human life. It stimulates the growth of production and spiritual growth of a person, develops abilities and functions, controls production and regulates the market. In life, competition helps to choose the strongest, and in economics it helps to get a good quality product or service at a lower price.

Essay on the topic:

« Competition and formation of market value. Monopoly and competition"

Competition in Latin means “to collide” and can be defined as rivalry between individuals and business units interested in achieving the same goal. If this goal is specified from the point of view of the marketing concept, then market competition is the struggle of firms for the limited volume of effective consumer demand, waged by firms in the market segments available to them.

The market nature of economic relations means freedom of choice for the buyer and seller. The market mechanism operates through the relationship between supply and demand, which presupposes the necessary price mobility, competition between goods and, therefore, commodity producers. Competition is an integral part of the market environment, necessary condition development of business activities.

Competition has both positive and negative sides:

1) it promotes the development of scientific and technological progress, constantly forcing the commodity producer to apply the best technologies and rational use of resources. In the course of it, economically ineffective production, outdated equipment, and low-quality goods are washed away;

2) it reacts sensitively to changes in demand, leads to cheaper production costs, slows down price increases, and in some cases leads to their reduction;

3) to a certain extent equalizes the rate of return on capital and the level of wages in all sectors of the national economy.

The negative aspects include:

1) gives business a certain instability, creates conditions for unemployment, inflation and bankruptcy;

3) its consequence may be overproduction of goods and underutilization of capacity during periods of production downturns.

Competition presupposes the freedom of economic units to enter and exit any particular industry. This freedom is necessary so that the economy can adequately adapt to changes in consumer tastes, technology, or resource supply. The main economic advantage of the market system lies in its constant stimulation of production efficiency.

During the years of the planned economy in our country, competition did not play the role that it plays under market economic methods. Directories, dictionaries and textbooks on the political economy of socialism regularly announced the complete elimination of competition and its replacement by conflict-free (or low-conflict - with winners and without losers) social competition. Thereby Russian economy has turned not only into a system of highly monopolized production, but literally into the sum of gigantic industrial subsistence farms, independently providing themselves with everything they need: from auxiliary production to the social sphere. Ultimately, all this led to low production efficiency, excessive high level costs, and, in some industries, to a deep technological lag behind advanced scientific and technical developments.

From the point of view of the organization of a planned economy, the concentration of production in monopolies was considered the most effective way management, and competition is a source of chaos and crises of overproduction.

Significant results complementing the model of perfect competition, but from the position of the law of value, were proposed in “Capital” by K. Marx.

In his opinion, competition, by regulating the distribution of capital between industries, contributes to the tendency of the rate of profit to decrease, the formation of an average rate of profit. “Equality of profits in all branches of industry and National economy presupposes complete freedom of competition, freedom of capital flow from one industry to another. And private ownership of land creates a monopoly, an obstacle to this free flow. Due to this monopoly, for example, the products of agriculture, characterized by a lower composition of capital and a higher rate of profit, do not go into a completely free process of equalization of the rate of profit; the owner of the land, as a monopolist, gets the opportunity to keep the price above the average, and this monopoly price gives rise to absolute rent.

Seeing firsthand the weakness and unfoundedness of the theoretical views of the utopian socialists and the helpless attempts to build real communes, supporters of the socialist idea tried to lay a more reliable foundation for communism. Karl Marx took up the solution to this historical problem, deeply penetrated into the essence of economics and developed his own system of views on theoretical economics(political economy). He relied mainly on the labor theory of value and the views of the classical school, but significantly changed many of their provisions. To a certain extent, the ideas and plans of the theory developed by K. Marx were supplemented and somewhat reworked by Friedrich Engels () and Vladimir Ilyich Lenin (1870-1924). This theory was called scientific socialism (communism) or Marxism-Leninism.

Together with Engels, Marx wrote the Manifesto of the Communist Party (1848), which discussed the principles of a communist society. What was written on the manifesto banner? Cancel private property on land and means of production, the introduction of collective property belonging to all members of society, the centralization of money, capital, transport in the hands of society, the same duty of labor for everyone, the solution economic issues according to the general plan.

The “Manifesto” remained a programmatic work for each state trying to build a socialist and, on its basis, a communist society, but it did not contain a theoretical justification for the programmatic demands of the communists.

The economic theory of K. Marx was most fully expounded much later in the never completed book “Capital” (the first volume appeared in 1867, two next volumes were published after the author’s death in 1885 and 1894, respectively).

Marx has been interpreted so much and in such a variety of ways that under the layers of interpretation it is sometimes difficult to discover the own views of the founder of Marxism.

In addition, K. Marx created a system covering all social sciences, therefore the purely economic component of his system is hidden by philosophical, sociological, and historical ideas. And finally, in Russia, where it is believed that the economic system of Marxism was put into practice for the first time in the world, the attitude towards this man and his theories is largely ambiguous and often stems not from the essence of his theory, but from how Marxism influenced destinies of people. Therefore, without entering into a discussion on this issue, I would like to note only the following. Firstly, it is not a fact that everything that was consecrated in the name of Karl Marx in our country is related to Marxism. Secondly, in terms of the depth of his analysis of economic problems, K. Marx hardly has any competitors among the theorists of the 19th century, and this fact is recognized by professional economists all over the world.

K. Marx proceeds from the idea of ​​the classical school that the price of a product is based on the so-called value (exchange value) or the value of this product, which is determined depending on the amount of labor spent on its production. Further, in contrast to the classics, he clarifies that labor costs that determine the value are not individual, but socially necessary, that is, numerically equal to the number of working hours that are required on average to produce a product at a given level of production development. Thus, only hired labor, the proletariat, produces value.

The second participant in this process is the entrepreneur, the capitalist who is the owner of the main type of wealth, the owner of capital. Capital is embodied in buildings, machines, tools, raw materials, in everything with which hired workers produce products. Historically, all means of production are concentrated in the hands of some people, so other people are forced to sell their labor to capitalists in order to survive. The capitalist, like any buyer of goods, pays labor power at a cost that is equal to the socially necessary labor time spent on the production of consumer goods consumed by the worker and his family. The worker works during the working day, producing more value than his labor power is worth. Since the owner of capital is the entrepreneur, the excess value, surplus value, is appropriated by the capitalist. By appropriating surplus value, the entrepreneur capitalizes part of it, that is, transforms it into additional portions of capital. There is a process of gradual accumulation of capital, therefore, even if capital was initially obtained through the labor efforts of the capitalist himself, sooner or later it becomes the result of the appropriation of the fruits of someone else's labor.

According to K. Marx, the capitalist, when making any economic decisions, is guided by the “absolute law” - maximizing the amount of surplus value. He is driven to this not only by natural greed, but also by competition from other capitalists. A kind of natural selection among capitalists leads to the fact that only those who extract the maximum possible surplus value by exploiting wage labor retain their position in the capitalist class. The capitalist who does not maximize surplus value cannot accumulate capital, loses his competitive position, sooner or later becomes poor and drops out of the capitalist class.

Thus, both hired workers and capitalists are, as it were, hostages existing system, which rigidly sets their behavior patterns. The way out of this vicious circle is determined by the very process of functioning of the capitalist economy. On the one hand, as more and more advanced machines and mechanisms are introduced into production, the need of enterprises for human labor decreases. An increasing proportion of hired workers are falling out of work production process, falling into poverty and losing the opportunity to ever work in the future. On the other hand, the higher the level of accumulated capital, the more intense the competition between entrepreneurs for the amount of surplus value and, ultimately, the lower the profitability from investing in production. To obtain each subsequent unit of income, you initially need to invest more and more funds. The profitability of capital investments will gradually decline, in the long term leading to the fact that further accumulation and capitalization will become simply meaningless. As soon as such a polar state occurs, the capitalist economic system, as K. Marx believed, will come to an end.

It remains only through a social revolution on a global scale to eliminate the system of private property, which is the main limiter to further development, and move to public regulation of economic life based on the principles of equality of all people and justice. This is a simplified scheme of the Marxist economic concept, which, if desired, can be criticized, supplemented and complicated.

Of course, in reality, Marxist analysis is much deeper and theoretically more conclusive than we have presented it. Along the way, it is worth noting that K. Marx not only sets out this scheme, but also develops a number of special theoretical issues characteristic of the economy of that period. Among these issues we can name the theory economic cycle, income theory, theory wages, theory of simple and expanded reproduction, theory of land rent. In addition, he makes serious historical excursions into the field of politics, legislation, and government. But all these questions are considered by him through the prism of his economic approach and serve to substantiate the same thesis about the inevitability of the socialist revolution and the victory of the new communist system in world history.

List of used literature

1. Title: Political Economy

2. Origins: Economics in the context of history and culture. - Kuzminov: State University Higher School of Economics, 584 p.

3. National economy: Tutorial. 2nd ed. - Gradov: Peter, 240 p.

4. Large economic dictionary. 2nd edition - Borisov: Book World 860 p.

5. Economics: principles, problems and policies. – M., 1993. – P. 23-25.

Competition, its types and role in economic development

Competition- is the struggle between economic entities for the most efficient use of production factors.

Competition- competition between participants in the market economy for the best conditions for the purchase and sale of goods.

In my opinion, these definitions fully reveal the concept of competition.

Competition is divided into types:

1. Perfect competition, freeor clean -an economic model found only in an idealized market; in this model, neither the producer nor the consumer is able to influence the cost of the product, but forms it through their contribution of supply and demand.

Signs of perfect competition:

· an infinite number of equal sellers and buyers

· homogeneity and divisibility of products sold

· no barriers to entry or exit from the market

· high mobility of production factors

· equal and full access of all participants to information (prices of goods)

All signs must be COMPLIED, in the absence of at least one sign it will already be imperfect competition. David Ricardo believed that under perfect competition, economic profit will decrease for each seller.

2. Imperfect competition -an economic model in which individual producers have the ability to control the cost of the products they produce. IN modern economy this model is considered the most common.

Signs of imperfect competition:

· presence of barriers to entry into the industry;

· product differentiation

· the main share of sales falls on one or several leading manufacturers;

· the ability to control fully or partially the price of your products.

Types of imperfectly competitive markets Number of producers Degree of product differentiation Degree of price control Barriers to entry Monopolistic competition Large number of firms Diverse products Relatively small Low Oligopoly Small number of firms Same products or with minor differences Partial High Monopoly One firm Same product with no substitutes Complete High

There are many examples of markets with imperfect competition. For example, the soda market, led by Coca Cola and Pepsi. The imperfect economy also includes the car market (BMW, Mercedes Benz, Audi, etc.), the household appliance market (Samsung, LG, Sony), etc.

There are such types of imperfect competition as monopoly, oligopoly and monopolistic competition.

Types of imperfect competition

Monopolistic competition (Monopolistic competition) - a type of market structure consisting of many small firms producing differentiated products, and characterized by free entry into and exit from the market. The products of these companies are close, but not completely interchangeable, i.e. Each of the many small firms produces a product that is slightly different from that of its competitors.

Oligopoly (Oligopoly) is a type of imperfectly competitive market, characterized by the action of several sellers in the market, and the emergence of new ones is difficult or impossible.

Pure monopoly (Pure monopoly) - organization of a market in which there is a single seller of a product, and there is no close substitute for this product in other industries. Along with oligopoly and monopolistic competition, monopoly is an example of imperfect competition.

Joan Robinson (1903-1983), a Keynesian economist, notes in her book The Theory of Imperfect Competition (1933) that the concept of perfect competition overly idealizes the real economy. In Robinson's concept, the manufacturer has the ability to influence prices. This opportunity arises as a result of its exceptional position. It is difficult for other firms to enter the market as a result of the creation of “legal barriers” to entry into the industry (a term coined by J. Robinson herself) and unfair competition. Robinson believes that monopolization of the economy leads to social injustice, even to “monopolistic exploitation.” Joan Robinson (1903-1983), a Keynesian economist, notes in her book The Theory of Imperfect Competition (1933) that the concept of perfect competition overly idealizes the real economy. In Robinson's concept, the manufacturer has the ability to influence prices. This opportunity arises as a result of its exceptional position. It is difficult for other firms to enter the market as a result of the creation of “legal barriers” to entry into the industry (a term coined by J. Robinson herself) and unfair competition. Robinson believes that monopolization of the economy leads to social injustice, even to “monopolistic exploitation.”

The role of competition in economic development

From the definition of competition - the rivalry of participants in a market economy for the best conditions for the purchase and sale of goods. We conclude that entrepreneurs are fighting “for the best conditions of purchase and sale.” And the best conditions of purchase and sale will be achieved only if the entrepreneur interests the consumer. How to interest the consumer!? It is necessary to meet all its requirements - price, quality, performance, design, etc. Manufacturers are trying to satisfy customer requirements through the introduction of new technologies, rational use of raw materials, etc. Competitors using more advanced technologies encourage others (their competitors) to use even more advanced technologies. And thanks to this, a certain “arms” race begins. As a result, I can say with confidence that competition directly affects progress. But progress is not an integral part of modern society!

Like everything that exists, competition has its negative aspects of competition:in competition, there is ruthlessness and cruelty towards the loser, and a large number of “victims” in the form of bankruptcies and unemployment.

Adam Smith made a statement about the key role of competition as a mechanism for automatic price regulation in free markets. He called competition the “invisible hand” that forces market sellers to set prices for goods in accordance with the level of demand for them from buyers, so that a highly competitive market itself forms the equilibrium price of the quantities of demand and supply, known as the equilibrium price.

Competition is the basis market economy, a powerful incentive economic growth, improving product quality, accelerating scientific and technological progress and reducing production costs and prices. By encouraging enterprises to reduce their production costs, leading to the elimination of unprofitable industries that are burdensome to society, competition contributes to the intensification and increase in the efficiency of social production. By orienting the commodity producer to the needs of the market, competition creates opportunities for the widest choice of goods and services and the most complete satisfaction of production inventories.

Competition in the economy performs a number of functions:

· identifies and establishes the market value of goods;

· reduces specific labor to socially necessary;

· promotes the equalization of individual costs and profits depending on labor productivity and the efficiency of production management.

Through competition, not only factors of production are distributed, but also income is distributed in accordance with the contribution and efficiency of business entities. Effective use resources allows producers to receive high incomes; if resources are used inefficiently, they incur losses and can be forced out of the market.

List of materials used

competition market economic

Http://ru.wikipedia.org/wiki/Competition

Http://www.center-yf.ru/data/economy/Strategii-konkurencii.php

Http://slovari.yandex.ru/

Http://vadim-galkin.ru/politics/macroeconomics/adam-smith/

6.http://www.economicportal.ru/

Http://www.bibliotekar.ru/biznes-39/70.htm

Social Studies Essay

Essay on the topic of:
Competition is the only method of mutually coordinating our individual actions without coercion or arbitrary interference by authorities. F. Hayek

Essay on the topic of:
Competition is the only method of mutually coordinating our individual actions without coercion or arbitrary interference by authorities. F. Hayek.

Competition should be understood as the economic rivalry between participants economic activity in the struggle to achieve better results. It seems to me that the author’s definition of competition accurately defines its essence. Competition is a regulator of not only economic, but also political, cultural, and interpersonal relations. Competition performs the function of mutual coordination of our actions without interference from authorities: people compete for better results, greater profits, better living conditions. In the course of competition, they objectively change the objects around them, their relationships, adapt to each other, strive to keep up with others, i.e. mutual coordination actions. For example, a certain product is presented in excess on the market, i.e. the amount of supply is greater than the amount of demand. This is where the law of competition comes into play: by increasing efficiency, a manufacturer can reduce production costs, reduce the cost of goods, improve their quality and, ultimately, reduce prices for their goods. This will “spur” other manufacturers to respond. A decrease in price will lead to an increase in the quantity demanded for this product. Thus, competition can, without any government intervention, regulate supply and demand and coordinate the actions of various producers. You can give other examples of competition that are not related to economics: a competition of musical groups, presidential elections, entrance exams, etc. Thus, competition is a universal regulator of the entire life of society.

9

“Societies that rely on competition... are more successful in achieving their goals than others. This is a conclusion remarkably confirmed by the entire history of civilization.” I couldn't agree more with Friedrich August Von Hayek in terms of competition in society. Indeed, as history shows, a society in which there is a constant struggle for survival in every segment of the economy is developing at a faster pace. If we allow a corporation to seize a monopoly in any segment of the economy, it will be able to dictate its own terms, most likely unfavorable for consumers of goods produced by the corporation, and if we allow a second corporation to compete with the first, then we will get new market sales Here 2 corporations will fight for a buyer because of which the goods will be cheaper and of higher quality. For example, “BMW” and “Mersedes-Benz”. These two companies competed with each other for many years. So what's the result? Both companies have gone far ahead of Lada, which all this time existed in greenhouse conditions, where a new engine, better aerodynamics, suspension, etc. were not needed. A segment of any sphere of society can be likened to this example. Over the years, the lack of competition makes itself felt - Lada cars cannot compete with the battle-hardened BMW and Mercedes on the world market, that is, such a company has nowhere to grow, it will never catch up with the “foreigners” through its own efforts in order for it to stay afloat you have to invest additional funds from the state treasury, so as not to launch the automobile industry in the state at all. Thus, the statement of the Austrian economist and political scientist F. Hayek is once again proven.