Characteristics of Oligopoly:1. Interdependence:
The most significant feature of oligopoly is interdependence in decision-making. As there are some firms, each firm closely watches the activities of other firm. Any transform in price, product, output, and so on by a firm will have a direct effect on the fortune of its rivals. Therefore an oligopolistic firm should consider not only the market demand for its product, however also the possible moves of another firm in the industry.2. Group Behavior:
Firms might realize the significance of mutual cooperation. Then they will have a tendency of collusion. At similar time, the desire of each firm to earn maximum gain might encourage competitive spirit. Therefore, co-operative and collusive trend and also competitive trend would prevail in an oligopolistic market.
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