Showing 1 - 3 of 3
Average profits of a price taker are increasing in the variability of the output price (Oi, 1961). We show that, for the same reason, average profits of the price taker are increasing in the variability of the price of inputs. We proceed to establish that the same holds for a firm with a...
Persistent link: https://www.econbiz.de/10001600012
To the surprise of many, price deviations between markets characterized by imperfect competition have often been little affected by lower transport costs. In a Cournot model we show that if firms' decisions to segment markets are endogenous, then lower transport costs are, in many cases,...
Persistent link: https://www.econbiz.de/10001622434
Persistent link: https://www.econbiz.de/10001582799