在讨论不同类型的市场结构时，垄断只是一个范畴，只有一个卖方处于垄断市场，完全竞争的市场处于另一端，许多买方和卖方提供相同的产品。也就是说，经济学家所说的“不完全竞争”有很多中间立场。不完全竞争可以采取多种不同形式，不完全竞争市场的特殊特征对消费者和生产者的市场结果有影响。许多公司 – 垄断竞争市场中有许多公司，这是使他们与垄断区别开来的部分原因。产品差异化 – 尽管不同公司在垄断竞争市场上销售的产品彼此相似，被认为是替代品，但它们并不相同。这一特征使垄断竞争市场与完全竞争的市场区别开来。 自由进入和退出 – 企业可以自由进入垄断竞争市场，当他们发现这样做有利可图时，他们可以在垄断竞争市场不再有利可图时退出。从本质上讲，垄断竞争市场是这样命名的，因为虽然公司在某种程度上为同一组客户互相竞争，但每家公司的产品与所有其他公司的产品略有不同，因此每家公司都有类似于市场上的小型垄断产品。垄断竞争是不完全竞争的一种形式。垄断竞争市场具有许多具体特征：由于产品差异化（以及市场力量），垄断竞争市场中的企业能够以高于其边际生产成本的价格出售其产品，但可以自由进入和退出推动垄断竞争市场中的公司的经济利润为零。此外，处于垄断竞争市场的公司遭受“产能过剩”，这意味着它们不是以有效的生产量运作。这种观察以及垄断竞争市场中存在的边际成本加价，意味着垄断竞争市场不能最大化社会福利。
When discussing different types of market structures, monopolies are at one end of the spectrum, with only one seller in monopolistic markets, and perfectly competitive markets are at the other end, with many buyers and sellers offering identical products. That said, there is a lot of middle ground for what economists call “imperfect competition.” Imperfect competition can take a number of different forms, and the particular features of an imperfectly competitive market have implications for the market outcomes for consumers and producers. Many firms – There are many firms in monopolistically competitive markets, and this is part of what sets them apart from monopolies. Product differentiation – Although the products sold by different firms in monopolistically competitive markets are similar enough to one another to be considered substitutes, they are not identical. This feature is what sets monopolistically competitive markets apart from perfectly competitive markets. Free entry and exit – Firms can freely enter a monopolistically competitive market when they find it profitable to do so, and they can exit when a monopolistically competitive market is no longer profitable. In essence, monopolistically competitive markets are named as such because, while firms are competing with one another for the same group of customers to some degree, each firm’s product is a little bit different from that of all the other firms, and therefore each firm has something akin to a mini-monopoly in the market for its output. Monopolistic competition is one form of imperfect competition. Monopolistically competitive markets have a number of specific features: Because of product differentiation (and, as a result, market power), firms in monopolistically competitive markets are able to sell their products at prices above their marginal costs of production, but free entry and exit drive the economic profits for firms in monopolistically competitive markets to zero. In addition, firms in monopolistically competitive markets suffer from “excess capacity,” which means that they are not operating at the efficient quantity of production. This observation, together with the markup over marginal cost present in monopolistically competitive markets, implies that monopolistically competitive markets do not maximize social welfare.