Dhingra, Swati; Morrow, John - Centre for Economic Performance, LSE - 2012
quantities, variety and productivity. Under constant elasticity demand, each firm prices above its average cost, yet we show … market allocations are efficient. When demand elasticities vary, market allocations are not efficient and reflect the … as a remedy to imperfect competition. Both market distortions and the impact of integration depend on two demand side …