What Does Duopoly Mean?

Introduction

A duopoly is a market structure where two companies dominate an industry. These two firms hold significant market power, influencing pricing, supply, and competition.

Key Features of a Duopoly

✅ Limited Competition – Only two major players control the market.
✅ Interdependent Decisions – The actions of one company directly affect the other.
✅ High Barriers to Entry – New competitors struggle to enter due to strong market control.

Real-Life Examples of Duopolies

• Coca-Cola vs. Pepsi – The soft drink industry is largely controlled by these two brands.
• Airbus vs. Boeing – The global aircraft manufacturing sector is dominated by these two giants.
• Visa vs. Mastercard – The payment processing industry is mainly run by these two companies.

Impact of a Duopoly

• Pros: Stable pricing, innovation due to competition, and strong brand trust.
• Cons: Limited choices for consumers, potential price-fixing, and reduced competition.

Conclusion

A duopoly occurs when two companies control a market, shaping industry trends and limiting competition. While it can drive innovation, it may also restrict consumer choices. 🏭⚖️