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Competition and Growth

In: Competition and Growth

Author

Listed:
  • Jati K. Sengupta

    (University of California)

Abstract

The economic theory of market competition involves two stages of decision making. One is at the firm level, where each firm chooses its output optimally by maximizing profits. This yields the rule: price equals marginal cost. The second stage involves the optimal number of firms in the total industry or market, where total supply must satisfy total demand. The first stage is internal to the firm, whereas the second stage is internal to the industry. At the equilibrium price each active firm maximizes its profits and the market clears in the sense that all demand is satisfied.

Suggested Citation

  • Jati K. Sengupta, 2004. "Competition and Growth," Palgrave Macmillan Books, in: Competition and Growth, chapter 1, pages 1-35, Palgrave Macmillan.
    • Handle: RePEc:pal:palchp:978-0-230-50531-5_1
    DOI: 10.1057/9780230505315_1
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    Cited by:

    1. Sahoo, Biresh K & Khoveyni, Mohammad & Eslami, Robabeh & Chaudhury, Pradipta, 2016. "Returns to scale and most productive scale size in DEA with negative data," European Journal of Operational Research, Elsevier, vol. 255(2), pages 545-558.
    2. Ramakrushna Panigrahi, 2021. "Evaluating Level Efficiency Versus Growth Efficiency in the Indian Automobile Industry in a Non-parametric DEA Approach," Global Business Review, International Management Institute, vol. 22(4), pages 963-976, August.
    3. Ramakrushna Panigrahi, 2021. "Returns to Growth in Indian Automobile Industry: A Non-Parametric Data Envelopment Analysis (DEA) Approach," Journal of Quantitative Economics, Springer;The Indian Econometric Society (TIES), vol. 19(4), pages 747-765, December.

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