Competing Views of Competition and the Condition of Rivalry in Iranian Economy Print

In neoclassical theory, competition is a statement about the structure of market and defined in terms of state of equilibrium as well as the number of firms and their similarities. Critics of neoclassical view argue that competition is a succession of events, a dynamic process of change and innovation, a voyage of exploration into the unknown in which successively superior products and production methods are introduced. Unlike neoclassic writers, critics has emphasized on behavioral heterogeneity and differences between firms. They believe, to attain competitive advantage, firms must able to change their characteristics and offer differentiated products. In this paper we begin with a review of some competing view of competition and go on to develop an evolutionary approach to competition. The condition of competition in Iranian manufacturing sector is further investigated. Our findings indicate that competition is absent within industries and only take place between industries. This is the inevitable result of the prevalent allocation of resources in Iranian economy.