of events made economists give up their attempts to construct the theory moving from one unreal model to another, whether from monopoly to perfect competition as it was done by A. Cournot, or in the opposite way as it was done by L. Walras. After the Great depression, i.e. in the mid-thirties of the 20th century, the focus of researchers shifted to the center lying be- tween these two hypothetical extremes — to the markets of monopolistic competition and oligopoly. Their subjects, first, appear in a competitive environment, and, secondly, prove to possess (to various extents) market (exclusive) forces. The production of E. Chamberlin's, J. Robinson’s and G. von Stackelberg’s books gave an impetus to this sharp shift.

market (in terms of market morphology closest to real) has to be proceeded with studying the nature, features and tools of the implementation of market forces. For this purpose, hypothet- ical models of perfect competition where any elements of mo- nopoly power are completely absent and monopolies where such power is shown have to be taken into consideration. The order in which the information is presented is almost conven- tional for most microeconomics courses.

fect competition shows, in particular, that any enterprise is forced to sell its products at market price. It is also an inde- pendent variable in the model of perfect competition, and an enterprise that is under these conditions is often called a price taker. Its choice is limited only by making decisions on the rate of production.

as an independent variable, but not both of them at the same time, as, after all, a combination of the price and output are un- doubtedly predetermined by the quantity of the product de- manded. In practice, almost all such enterprises choose the price as an independent variable, providing the market with an opportunity to decide on a production rate. Thus, they are often called a price maker or price setter. In theory, a monopoly usu­ally accepts a production rate as an independent variable in the model, leaving the right to determine an adequate price to the market. Both of these approaches are equivalent though the second one possesses some practical conveniences.

like a price searcher. Though an oligopoly is also powerful to a certain extent, it cannot simply establish prices like a monop- olist. It should consider how the rival will react to its price de- cision. The world of an oligopoly is similar to the games in which each action of one player is followed by the opponent’s response, the outcome of the game being impossible to predict. As a result, a set of the oligopolistic models is used.

that was established in economic literature was the behavioral approach. A. Smith, in particular, associated competition with fair rivalry that is possible between sellers (or buyers) under ultimately advantageous conditions of selling goods. Thus, the main method of a competitive struggle is believed to be chang­es in price.

proach to study competition identifies the latter as a kind of

contest for rare economic goods and, for consumers’ money for which they can be purchased. The logic of this approach im- plies the fact that most benefits (goods, services, resources) are rare in the sense that their quantity is a less potential require- ment of our society. Therefore, the owners of benefits have an opportunity to distribute them, being guided by the nature of the benefit. They create conditions or criteria (a required price level, qualities, etc.), and taking into account these conditions, they decide whom they should provide these benefits with. "Competition is the main goal as it can better meet the criteria of accessing scarce resources", — says P. Heyne, modern American economist.

berlin’s works as well as to the papers of some other greatest scientists who laid the groundwork for the modern West­European concept of the four main types of the market: perfect competition, monopolistic competition, oligopoly, and monop­oly. The views of this group of scientists in modern West­European economic science are so influential that the term "competition" is more often used in terms of the structural un­derstanding. If it is necessary to emphasize the behavioral part of competition, there is quite often used another word — "ri­valry". The structural approach displaces the accent from the

For example, F. Knight defines competition as a situation in which there are a lot of competing entities and they are inde- pendent.

solutely different way and called it a "discovery procedure". In his opinion, it is only thanks to the competition that all secrets are out in the market.

reaction of their rivals to the actions. On the other hand, the behavior of a monopolist cannot be referred to as a kind of ri- valry as interdependence of economic units is insignificant in the markets of this structure (

(market morphology theory). In fact, classical economists did not distinguish these concepts, speaking usually simply about free competition. Free competition, in its opposition to monop- oly, was also the basis for the classics’ paradigm. However, speaking about free competition, they meant rivalry, first of all. As J. Stigler noticed, "competition was included into economic theory from common language, and for a long time, this word signified only independent rivalry between two or more peo- ple". A. Smith related competition directly to "experience" or "rivalry aggravation".

The classics of economic thought certainly understood that free competition is not always absolute as well as it’s not equally free everywhere; they recognized that its effects can be limited or blocked in some situations by the actions of some other factors, for example, by customs. Therefore, one should take into consideration "political economy" ideas and apply them to the real world conditions to avoid mistakes. For in- stance, J. S. Milne insisted on paying attention not only to something "that will occur under ultimate conditions of a max- imum domination of competition, because in the case of a competition relative domination the result will be different". Economists could consider this requirement, however, only when the degree of this relativity of "the competition domina­tion" is treated qualitatively in the market creation theory (the market typology theory).

that are monopolistic and called organizations, economies, or industries), it is reasonable to use only the term “rivalry” and its derivatives, but not the term "competition".

• free enterprise provides an individual with the right to purchase resources and to launch manufacturing at his or her own discretion;

• a limited role of the state means that society in general stands for a wide economic personal freedom, considers it jus­tified, and does not aim at being subject to control.

advantages and disadvantages.

Disadvantages: individuals’ unlimited selfish interests are capable of undermining economic stability that is ultimate- ly the basis of their own existence.