Non-price Competition

It includes all forms of competition that do not use the price mechanism. For example: ‘first-come, first-served’, political power, lucky draw.

It can be found when the market price is lower than the equilibrium price, where the market is in disequilibrium and shortage exists.

The full cost for consumers obtains the goods will be:

money price + cost of non-price competition, i.e. M in the diagram.