Dr. Mike Walden, North Carolina Cooperative Extension economist in the College of Agriculture and Life Sciences at N.C. State University, responds:

"Well, the competitive part of the model can fall apart. And we actually have a name for industries where you have only a handful of businesses competing, and we call that as you mentioned "oligopoly." Two good examples, the U.S. auto industry in the 1950s, where you had essentially three or four companies selling all the cars to Americans, and also here more closer to home would be the tobacco companies, the cigarette companies.

"Now, firms in an oligopoly can compete, but the worry is they won't. Instead of competing, they will cooperate. And that cooperation can lead to higher prices for consumers. Now, actually there are laws on the books against cooperation between firms instead of competition. Those laws are strictly enforced. But oligopolies have actually become less of a power today because of technology and globalization. Again, think of our auto companies. Now they have to compete with auto companies around the world. And that's good news for consumers because more competition generally means lower prices. But it's sort of bad news if you are one of those old companies, because today I think it's much harder to successfully run a business."