Crime Against Humanity: Pensée Unique in Economics, 19
What is perfect competition?
When you research the subject, you end up with the adjective ‘perfect’ being synonymous of ‘fair’. Fair competition and fair market meaning no one throws one’s weight around, we see how this is an ideal condition having quite a number of, alas, quite idealistic requisites. Wikipedia currently lists thirteen of them, specifying that the actual requisites merely include those listed, and pointing out that those listed are but those currently prevailing in the discussion on the subject. It is nonetheless interesting to summarise them here to give you an idea:
Enough buyers−comsumers and sellers−producers willing and able to purchase and supply the products at a price to their liking.
All buyers−comsumers and sellers−producers know everything there is to know about all products, including their prices and their benefits.
The competing products of competing sellers−producers are perfectly interchangeable with one another.
The property rights regulating what, and what rights to it, are owned and can thus be traded are well defined and established.
There are no barriers to transfers of products in the area.
All participants are price takers, and no one has such market power to set prices.
The are no barriers, at least in the long run, to the perfect mobility of any factors of production to adjust to the changes in market conditions.
All sellers−producers are free to adjust, and do adjust, to the price, input and output levels that lead to their highest profit.
All buyers−comsumers are free to make, and do make, all trades that give them the maximum economic utility, as well as free to not do vice versa, too.
Costs or benefits of any activity do not affect third parties, including no externalities on anyone from government intervention.
The cost of any transaction in itself is zero, and therefore does not add any additional cost to it.
Regulation authorities provide fair and effective regulations and protections eliminating any anti−competitive practices.
