ABSTRACT
This is true not only for the relationship between market structure and innovation-it is true more generally for the relationship between market structure, competition, and economic efficiency. We can, of course, easily construct cases in which a high degree of market concentration goes along with lack of competition and inefficient resource use. We can, however, equally well construct examples in which concentration is the result of aggressive competition, and where the result is efficiency. It is also possible to construct cases where concentration reflects monopoly, but where monopoly power is exploited in a way which is consistent with efficiency.
