Competition is considered a universal indicator of market development. The word has Latin roots and literally means “compete”. Smith interpreted the concept as a behavioral category. Let us further consider the content and functions of market competition. 
general information
Market and market competition presuppose the rivalry of the old and the new, production competitiveness. The trading floor and the struggle within it are carried out within the framework of legal norms. The content of market competition is a constant search, offering the best conditions for the seller and the buyer. Trading involves changing various situations of uncertainty. Being competitive means being ahead of the competition in the attractiveness of your offer, striving to be the first. With a constant change in the degree of awareness of the subjects, alternative opportunities for certain transactions also change. This, in turn, allows you to adjust the purchase or sale plans. This shows the content and functions of market competition.
Classification
In the process of exchange, the following types of market competition are distinguished:
- Price, involving the monopoly establishment of a certain value of a particular product, the prohibition of deviations from a given value.
- Perfect. This type of competition provides for such a number of market participants in which none of them can decisively influence their price proposals on the price established at the auction.
- Imperfect, implying a limiting circumstance. An example is monopoly. This model of market competition is characterized by a different nature (criminal, administrative, and so on).
- Non-price, established by improving the quality of the product and the conditions for its sale.
The above types of market competition have their advantages and disadvantages.
Free trade
Perfect market competition, the role of which is to regulate social production, allows achieving the interests of manufacturers and consumers. At the same time, the first and second winnings are ensured. In this case, the role of competition in a market economy is to orient the activities of enterprises towards the needs of customers, which are expressed through solvent demand. 
Resource allocation
The role of competition in a market economy is also to ensure effective interaction between participants in trade due to the information embedded in prices. This primarily means that the required number of producers corresponding to demand is identified. In addition, the distribution of resources ensures the maintenance of high profitability. This is due to the fact that all manufacturers whose costs exceed equilibrium price must either reduce them or leave the trading floor.
Main advantages
Self-adjusting mechanisms of market competition in free trade force all sellers and manufacturers to focus on price signals and establish optimal volumes of output and sales. Ideally, this promotes efficient distribution limited resources between types of production and sectors of the economy. As a result, enterprises produce only what is needed and in the quantity necessary for consumers, with minimal costs, while receiving the maximum income. Thus, NTP is stimulated and the quality of the goods is improved.Such market competition is considered deficient, with a high level of adaptation to constantly changing conditions.
Pareto Optimum
As long as there is market competition, firms in the short term may incur losses or receive excess profits. For a long time, high income has attracted other companies to the industry. At the same time, profit disappears, ruin of unprofitable enterprises occurs. In the long run, therefore, a situation arises called Pareto optimality - "no loss, no profit." It is believed that it exists when the distribution of finished goods and resources does not imply a redistribution that improves the situation of at least one entity and does not worsen the condition of others. Pareto Optimum eliminates waste of money. This situation is in a state of perfect market competition. 
Disadvantages of free trade
Perfect market competition is not able to ensure the satisfaction of the needs of society, not expressed in personal solvent demand. The situation is such that people want to consume certain products, but cannot afford them. In this regard, manufacturers involved in various business sectors cannot produce them. These services and goods are called public goods. When provided to one entity, they are available to the rest at no additional cost. Public goods are considered non-competitive. That is, their consumption by one subject does not reduce accessibility to the rest.
Monopoly
This concept is quite capacious and multifaceted. In the framework of economic theory, monopoly is considered from different points of view: the structure of the purchase and sale system, results, and behavior of subjects. In general terms, such a model can be described as the dominance in the industry of one enterprise, and its boundaries and the limits of the economic sector coincide. Thus, free market competition is considered the exact opposite of monopoly.
Main types
In the modern world, the use of the term "monopoly" has gone beyond the limits of literal interpretation. Now the concept characterizes different situations that are not characteristic of perfect competition. The monopoly implies exclusive rights to fishing, production, trade and other activities belonging to a certain group of entities, the state or one person. It can be closed, open and natural. In the latter case, a monopoly is formed in an industry where the average long-term costs become minimal when the market is served by only one company. An open system occurs when one enterprise (at least for a specific period) acts as the sole supplier. However, at the same time, it is not protected by special legal means from competition. Such enterprises usually go to the marketplace with new products. Artificial monopolies are created by several specific companies:
- cartel;
- concern;
- syndicate;
- conglomerate;
- trust.
The nature of monopoly competition
Under the dominance of this form, trade is carried out according to a specific scheme. First of all, the monopoly receives fairly accurate information about potential competitors and consumers. Also, as part of this form of doing business through advertising, there is a significant impact on the formation of consumer demand. This is due to the fact that public relations are more accessible for a large company. In addition, the monopoly, speaking on behalf of state institutions, through channels of political and financial relations affects the counterparty or customer.
Distinctive features
Monopolistic competition has the following features:
- The presence of a relatively large number of manufacturers producing a similar but not identical product. For example, 20, 30, 75 companies make vehicles.
- The presence of differentiated products that appear in the form of:
- goods that differ in quality or physical indicators (for example, one of the companies selling cars focuses on internal design, while the competitor attaches more importance to the quality of the motor);
- services related to the sale of a product: packaging, advertising, brands, trademarks (for example, a memorable bright PR campaign can convince many buyers that a product is the best and deserves a higher cost than its well-known counterparts).
- Price control.
- Relatively easy implementation in the industry.
Antitrust Law
Thanks to its action, the functions of market competition are realized. FAS exercises control over the concentration of business entities. Its tasks include monitoring the integrity of competition in various markets for services and goods. The Antimonopoly Service controls:
- Reorganization and creation of commercial enterprises in cases specified in Art. 27 Federal Law "On Competition".
- Conclusion of contracts and other actions to be notified antitrust authority in cases established by art. thirty.
- Transactions with shares (stocks), assets of financial and commercial companies, rights in relation to them, provided for in Art. 28, 29.
Thus, the functions of market competition are provided by law. The key criteria for conducting antitrust supervision is the total value of the assets of entities involved in transactions, according to the accounting documentation for the last reporting date preceding the date of the notification or application, or the total revenue of enterprises (groups of individuals) from the sale of products for the entire calendar year.
Important point
The chief accountant or the head of an enterprise participating in transactions for the sale of assets of other companies should take into account that they can be controlled by the Federal Antimonopoly Service. This is possible if the total cost or total revenue exceeds 400 million rubles. The first indicator is determined by the last balance. Total revenue is calculated by sales for the calendar year.
A responsibility
In the field of antitrust regulation sufficiently stringent conditions are provided. The law provides for liability for violations. In particular:
- A commercial enterprise formed without prior approval from the Federal Antimonopoly Service, including during the merger or acquisition of companies, in the cases specified in art. 27 of the aforementioned Law, is reorganized or liquidated in the form of separation / separation in a judicial proceeding.
- Dealing with the assets of organizations provided for in Art. 28, 29 Federal Law and committed without the approval of the Antimonopoly Service.
- An enterprise that is obliged to notify the FAS of the conclusion of the contracts referred to in paragraphs 1-5, part 1, art. 30 of the Law, which violated the procedure for notifying the supervisor, is reorganized or liquidated in the form of separation / separation in court at the suit of the authorized court.
- Failure to comply with the requirements of the antimonopoly service, its territorial division to prevent or terminate actions restricting market competition, or a lawful order to take certain measures will result in an administrative fine. For legal entities, the amount is from 100 to 500 thousand rubles, for officials - 8-12 000 rubles. For the latter, disqualification is also provided for a period of up to 3 years.
Industry challenges
The free market removes economic state boundaries, suggesting the formation of equilibrium prices on an international scale. The whole system, thus, provides a solution to 3 main tasks: what, how and for whom to produce. However, in the course of its life, society encounters various problems that the market economy is not able to solve.In this case, it is not so much about the flaws of the system as about what is not peculiar to it. Failures of the market mechanism are due to the inability to constantly comply with all necessary conditions for free competition. This is reflected in the instability of economic development. In particular, the economic upturns are interspersed with its recessions, accompanied by unemployment and inflation. 
Conclusion
From universal positions, distribution in the market is difficult to consider fair. This conclusion is primarily due to the fact that not all subjects are provided with at least a minimum standard of living. Distribution in market conditions is based on income, solvency. Any profit made in free competition is considered fair. Those who can’t get such an income (due to health conditions, old age, etc.) are doomed to beggarly existence. The market is not able to create conditions for the realization of the right to work and salaries for all citizens. Employment in modern conditions is available only to those entities whose specialization and profession are in demand.
