Definition of imperfect market

An imperfect market is one in which there is not full disclosure, or in which there are barriers to entry or exit or perhaps some form of manipulation. It differs from a perfect market which features perfect competition and the possibility of reaching an equilibrium in which no one can profit without someone else having made a loss. The foreign exchange market is sometimes said to be the nearest thing to a perfect market, but in reality all markets are imperfect markets.

 

imperfect market in the news

In May 2012, the FT reported that restructuring experts believed that Europe had too many airlines competing in an imperfect market distorted by state intervention. In March 2012 there were renewed concerns about secondary ticket selling on sites such as StubHub saying the surge in secondary ticket sales was a blight that was creaming off revenues from an imperfect market.

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