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Supportability, Sustainability, and Subsidy-Free Prices

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  • Leonard J. Mirman
  • Yair Tauman
  • Israel Zang

Abstract

This article studies the relationships among the concepts of subsidy-free prices, anonymously equitable prices, supportability, and sustainability. In particular, we set out conditions under which these concepts are not vacuous. Several new sets of conditions under which a subsidy-free price vector is sustainable are also presented. For general, nonseparable demands, we establish the existence of an Aumann-Shapley price vector that is anonymously equitable and sustainable.

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Bibliographic Info

Article provided by The RAND Corporation in its journal RAND Journal of Economics.

Volume (Year): 16 (1985)
Issue (Month): 1 (Spring)
Pages: 114-126

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Handle: RePEc:rje:randje:v:16:y:1985:i:spring:p:114-126

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  1. William W. Sharkey, 1981. "Existence of Sustainable Prices for Natural Monopoly Outputs," Bell Journal of Economics, The RAND Corporation, The RAND Corporation, vol. 12(1), pages 144-154, Spring.
  2. Mirman, Leonard J. & Tauman, Yair & Zang, Israel, 1986. "Ramsey prices, average cost prices and price sustainability," International Journal of Industrial Organization, Elsevier, Elsevier, vol. 4(2), pages 123-140, June.
  3. ten Raa, Thijs, 1983. "Supportability and anonymous equity," Journal of Economic Theory, Elsevier, Elsevier, vol. 31(1), pages 176-181, October.
  4. Faulhaber, Gerald R & Levinson, Stephen B, 1981. "Subsidy-Free Prices and Anonymous Equity [Cross-Subsidization: Pricing in Public Enterprises]," American Economic Review, American Economic Association, American Economic Association, vol. 71(5), pages 1083-91, December.
  5. John C. Panzar & Robert D. Willig, 1977. "Free Entry and the Sustainability of Natural Monopoly," Bell Journal of Economics, The RAND Corporation, The RAND Corporation, vol. 8(1), pages 1-22, Spring.
  6. Baumol, William J & Bailey, Elizabeth E & Willig, Robert D, 1977. "Weak Invisible Hand Theorems on the Sustainability of Multiproduct Natural Monopoly," American Economic Review, American Economic Association, American Economic Association, vol. 67(3), pages 350-65, June.
  7. Sharkey, William W. & Telser, Lester G., 1978. "Supportable cost functions for the multiproduct firm," Journal of Economic Theory, Elsevier, Elsevier, vol. 18(1), pages 23-37, June.
  8. Faulhaber, Gerald R, 1975. "Cross-Subsidization: Pricing in Public Enterprises," American Economic Review, American Economic Association, American Economic Association, vol. 65(5), pages 966-77, December.
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Cited by:
  1. Iehlé, Vincent, 2008. "Sustainability in a multiproduct and multiple agent contestable market," MPRA Paper 13013, University Library of Munich, Germany.
  2. Dreze, Jacques & Le Breton, Michel & Savvateev, Alexei & Weber, Shlomo, 2006. "0.19% Subsidy-Free Spatial Pricing," IDEI Working Papers, Institut d'Économie Industrielle (IDEI), Toulouse 423, Institut d'Économie Industrielle (IDEI), Toulouse.

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