1 What are the two distinguishing characteristics of oligopoly? Economics in Action above shows some examples of oligopoly. The dividing line between oligopoly and monopolistic competition is hard to pin down. As a practical matter, we try to identify oligopoly by looking at the five-firm concentration ratio qualified with other information about the geographical scope of the market and barriers to entry. A concentration ratio that divides oligopoly from monopolistic competition is generally taken to be 60 per cent. A market in which the concentration ratio exceeds 60 per cent is usually an example of oligopoly and a market in which the concentration ratio is below 60 per cent is monopolistic competition.