8 D. Oligopoly

Features: a few large firms dominate (a concentration ratio is the statistic); products homogeneous (cement) or differentiated (smartphone service); mutual interdependence — each firm's payoff depends on rivals' reactions (the defining trait; game theory is its native mathematics); high barriers (scale economies, licences, brand); indeterminate demand curve — hence the models: the kinked demand curve (Sweezy: price rigidity — match a cut, ignore a rise, so prices stick), cartel/collusion (joint profit-maximisation as a shared monopoly — OPEC the classic), price leadership (one firm sets, others follow). Nepali examples: cement; telecommunications (two dominant mobile operators for years, with the state-owned incumbent among them); airlines on trunk routes; commercial banking's big players; fuel supply. Legal connection (the unit's punchline for a law student): oligopoly is where the Competition Promotion and Market Protection Act 2063 does its hardest work — cartels and collusive tendering are the offences; abuse of dominance the abuse; merger control the prevention; and the consumer's remedy (with the Consumer Protection Act 2074 (2018)) the floor beneath it all. Antitrust law is applied oligopoly theory.