<P> Early economic research focused on the difference between price - and non-price - based competition, while later economic theory has focused on the many - seller limit of general equilibrium . </P> <P> Competition is generally accepted as an essential component of markets, and results from scarcity--there is never enough to satisfy all conceivable human wants--and occurs "when people strive to meet the criteria that are being used to determine who gets what ." In offering goods for exchange, buyers competitively bid to purchase specific quantities of specific goods which are available, or might be available if sellers were to choose to offer such goods . Similarly, sellers bid against other sellers in offering goods on the market, competing for the attention and exchange resources of buyers . </P> <P> The competitive process in a market economy exerts a sort of pressure that tends to move resources to where they are most needed, and to where they can be used most efficiently for the economy as a whole . For the competitive process to work however, it is "important that prices accurately signal costs and benefits ." Where externalities occur, or monopolistic or oligopolistic conditions persist, or for the provision of certain goods such as public goods, the pressure of the competitive process is reduced . </P> <P> In any given market, the power structure will either be in favor of sellers or in favor of buyers . The former case is known as a seller's market; the latter is known as a buyer's market or consumer sovereignty . In either case, the disadvantaged group is known as price - takers and the advantaged group known as price - setters . </P>

What happens to a resource when competition for it increases