Final answer:
Promoting competition typically results in less deadweight loss because competitive markets are more efficient and reduce the power of monopolies to control prices and output, leading to outputs that better reflect consumer demand and maximize social surplus.
Step-by-step explanation:
One possible outcome of promoting competition is less deadweight loss. This occurs because competitive markets tend to lead to more efficient outcomes where goods and services are produced and consumed at quantities closer to the ideal equilibrium, which is where supply meets demand. Moreover, promoting competition usually shifts the market away from imperfect competition scenarios such as monopoly or oligopoly, where firms have the power to set prices above the competitive level, leading to less efficiency and higher prices for consumers.
Deadweight loss, a concept within market efficiency, represents the loss in social surplus that occurs when markets are not producing at an efficient quantity. Competition tends to mitigate this by allowing for more transaction opportunities that reach both consumers and producers, thus maximizing the total surplus. Additionally, increased competition often results in lower output from monopolistic firms, as it diminishes their power to control the market, and instead leads to an output that reflects a competitive market, which is often higher overall for the industry.