An oligarchy is a political system where power resides in a small group of individuals or families, often characterized by political elites or corporate interests. This differs from a democracy, where power is vested in the population, primarily through electoral processes. In oligarchies, decision-making is concentrated, which can lead to policies favoring the elite at the expense of broader societal needs. While a democracy promotes active citizen participation, oligarchies often suppress dissent and limit political accountability and transparency.