The fundamental contribution of the paper is to contest the view that greater market contestability has non-negative effects on market performance. In a model where employees pose a threat of potential entry, we demonstrate that a reduction in barriers to entry causes no fall in industry price...

This paper looks into the application of the theory of “the persistence of profits” and how it can be used to model manufacturing industries in Colombia. By explaining where the theory of “persistence of profits” comes from, what it is, and what its determinants are brief descriptions of...