A Study on How Effectively to Regulate a Oligopolistic Market with the Competition Law

There are almost no perfectly competitive markets and also few monopolisticmarkets. However a huge number of oligopolistic markets which we have metin the real life may be a very important topic on the competition lawjurisdiction. A core characteristic of the oligopoly, interdependency, has beentold. Therefore oligopolists will make their own decisions considering theircompetitors’ reaction. It is very natural that the market’s interdependencycauses a kind of an equilibrium without any explicit or implicit agreementwhich is also Nash one. The Cournot oligopoly theory may give us a bestunderstanding on the Nash equilibrium. But oligopolists may try to exploittheir consumers more by taking more strategic tactics beyond the equilibrium. We need to fully understand the difference between the oligopolistic Nashequilibrium and strategic behaviours to pursue additional profits up to themonopolistic one. The trigger’s strategy, one of gorgeous game theories,makes us know the strength of the strategy’s incentive. Two legal approaches, a structural approach and a behaviour approach, toregulate the oligopolistic markets have been made. Almost all competitionlaws throughout the world provide some clauses to condemn the abuse ofmarket dominating positions and concerted practices which are considered astwo legal methods to get rid of some detriments caused by oligopolists. Tocondemn oligopolists as a abusive market dominance two elements, collectivemarket dominant position and its abuse, are asked to prove whereas asconcerted practices, their strategic behaviours in the market. Base on the above analysis, we need to make a stress on the difference betweenthe Nash equilibrium and strategic behaviour. While we interpret the relevantlegal methods in the Korean Monopoly Regulation and Fare Trade Act, we need to make sure it.