Examples Of Perfect Competition In The United States

One of the common example of a market with perfect competition within the United States is agriculture. Since the introduction of farm subsidies in the United States many smaller farms find this to disrupt the perfect competition that they would face with the larger farms. Having the government’s support and financial advantages makes a huge difference within the competition, letting larger farms get ahead within the competition. Smaller farms are then forced to work themselves to death trying to sell their crops for higher prices compared to large farms that can sell their crops for cheap and still make profits. People find this unfair because the government is paying the large farm owners to farm and also gives them extra money so that they can live with more privileges compared to others …show more content…
Smaller farms have to sell there diverse crops at higher prices because of the cost it takes to produce and maintain the crops. Large farms have the financial support from the government unlike the smaller farms, resulting in the larger farms being able to pocket more money for producing excess amounts of crops. The farm subsidies have a common trend of having the wealth redistributed upwards, making the rich richer and the poor poorer. According to the CATO HANDBOOK FOR POLICYMAKERS (2017), “In 2014, the average income of farm households was $134,164, which was 77 percent higher than the $75,738 average of all U.S. households. The same year, the median income of farm households was $81,637, which was 52 percent higher than the U.S. median of $53,657”. These are some of the few things that make this idea of perfect competition within the agricultural business a untrue and unrealistic