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Revisited: Monopoly and Long-Run Capital Accumulation in Two-Sector Overlapping Generation Model

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  • Ronald Ravinesh Kumar

    (School of Accounting, Finance and Economics, Laucala Campus, The University of the South Pacific, Suva 40302, Fiji)

  • Peter J. Stauvermann

    (Department of Global Business and Economics, Changwon National University, Changwon 51140, Korea)

Abstract

In this paper, we investigate if an increasing competition in an oligopolistic market will enhance the real incomes and consumer surplus in the long run. For this purpose, we apply a two-sector overlapping generation model in which members of the young generation own the oligopolistic firms. We show that increasing competition in the oligopolistic market leads to ambiguous outcomes regarding the real income and consumer surplus in the long run. However, we show that the distribution of income will become fairer if the competition increases, but it is possible that the price for a fairer distribution is a lower income for all members of the economy.

Suggested Citation

  • Ronald Ravinesh Kumar & Peter J. Stauvermann, 2021. "Revisited: Monopoly and Long-Run Capital Accumulation in Two-Sector Overlapping Generation Model," JRFM, MDPI, vol. 14(7), pages 1-19, July.
    • Handle: RePEc:gam:jjrfmx:v:14:y:2021:i:7:p:304-:d:587980
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    References listed on IDEAS

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    Cited by:

    1. Ronald Ravinesh Kumar & Peter J. Stauvermann, 2023. "International Borrowing and Lending in the Presence of Oligopolistic Competition," JRFM, MDPI, vol. 16(8), pages 1-26, July.

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