A note on price-taking and price-making behaviours in pure exchange economies
AbstractThis paper explores the rationale of price-taking and price-making behaviours in the context of Walrasian and Cournotian pure exchange economies. Beside the influence of the number of agents, we underline the role of the structure of preferences in the definition and in the working of market power. Through three equilibrium variations of the same basic economy, we obtain several results about price manipulation, about asymptotic identifications for large economies and for degenerate preferences, and about welfare comparisons. Perfect competition does not only correspond to the case of large economies, but may also concern economies where fundamental market powers are more or less equivalent.
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Bibliographic InfoPaper provided by University of Paris West - Nanterre la Défense, EconomiX in its series EconomiX Working Papers with number 2006-3.
Length: 16 pages
Date of creation: 2006
Date of revision:
Find related papers by JEL classification:
- D43 - Microeconomics - - Market Structure and Pricing - - - Oligopoly and Other Forms of Market Imperfection
- D51 - Microeconomics - - General Equilibrium and Disequilibrium - - - Exchange and Production Economies
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-02-17 (All new papers)
- NEP-COM-2007-02-17 (Industrial Competition)
- NEP-MIC-2007-02-17 (Microeconomics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Shapley, Lloyd S & Shubik, Martin, 1977. "Trade Using One Commodity as a Means of Payment," Journal of Political Economy, University of Chicago Press, vol. 85(5), pages 937-68, October.
- Giulio Codognato & Jean Gabszewicz, 1991.
"Équilibres de Cournot-Walras dans une économie d'échange,"
Presses de Sciences-Po, vol. 0(6), pages 1013-1026.
- Jean Gabszewicz & Giulio Codognato, 1991. "Équilibres de Cournot-Walras dans une économie d'échange," Revue Économique, Programme National Persée, vol. 42(6), pages 1013-1026.
- CODOGNATO, Giulio & GABSZEWICZ, Jean, . "Equilibres de Cournot-Walras dans une économie d'échange," CORE Discussion Papers RP -964, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
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