In this paper we study the social desirability of the structure regulation which transforms a single multi-product monopoly into an oligopoly where the industry produces differentiated complementary goods. In particular, we pay special attention to the cross-subsidization which will be...

We compare the Cournot and Bertrand equilibria in an asymmetric duopoly with product R&D competition. If a firm’s marginal cost is lower than that of its rival, then this firm (its rival) is referred to as the more (less) efficient firm. Under each mode of competition, there are three types of...

This paper examines the Laffer effect in the Ramsey tax-model with linear consumption taxes and a representative consumer. It is assumed that the private goods and the public good are weakly separable. It is demonstrated that if all of the private goods are weak gross complements to each other,...

<title>Abstract</title> In China, some scholars have argued that luxury spending is socially beneficial to equalise wealth, under the assumption that the total endowment of resources is a fixed amount. This argument is not only consistent with Confucianism but also might point to another lesser known side of...

This paper concerns an industry with two complementary goods. It is demonstrated that if a good is active in Cournot equilibrium, then it is active in either one of the socially optimal solution and the monopoly solution; but, the converse is not true. When demands are linear, a good is active...

This study compares a differentiated Cournot duopoly with a two-product monopoly by using the socially optimal solution as a reference point. Each solution is allowedto be either an interior or a corner solution. We establish that the ranking regarding each individual price is clear-cut and...