Competition
Also called: market competition · Topic: Globalisation and MNCs · NCERT: Class 9, Ch 8 "Building Blocks in Economics: The Problem of Choice"; Class 9, Ch 9 "The Price Puzzle: What Drives the Market"; Class 10, Ch 4 "Globalisation and the Indian Economy"
Meaning
Competition is rivalry among firms to win buyers through lower prices, better quality or new ideas (innovation). Globalisation increased competition because foreign producers joined the race. Consumers, especially well-off urban ones, gained more choice, better quality and lower prices. Many small local producers, however, faced a hard choice: "compete or perish".
Example
Ravi ran a capacitor unit in Hosur, Tamil Nadu, and had 20 workers. In 2001 the government removed import restrictions on capacitors under its WTO agreement. Imported capacitors then cost half Ravi's price. He now makes less than half his 2000 output and has only 7 workers.
Don't confuse with
- Monopoly: a single seller with no rivals, which is the opposite of competition.