The Welfare Effects of Monopoly Innovation
AbstractIn this paper we study the welfare effect of a monopoly innovation. Unlike many partial equilibrium models carried out in previous studies, general equilibrium models are constructed and analyzed in greater details. We discover that, technical innovation carried out by a monopolist could significantly increase the social welfare. We conclude that, in general, the criticism against monopoly innovation based on its increased dead weight loss is less accurate as previously postulated by many studies.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Nanyang Technolgical University, School of Humanities and Social Sciences, Economic Growth centre in its series Economic Growth centre Working Paper Series with number 0609.
Length: 28 pages
Date of creation: Sep 2006
Date of revision:
Find related papers by JEL classification:
- D50 - Microeconomics - - General Equilibrium and Disequilibrium - - - General
- D60 - Microeconomics - - Welfare Economics - - - General
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.:
- Waterson, Michael, 1982. "The Incentive to Invent When a New Input Is Involved," Economica, London School of Economics and Political Science, vol. 49(196), pages 435-45, November.
- Jenny, Frederic & Weber, Andre-Paul, 1983. "Aggregate Welfare Loss Due to Monopoly Power in the French Economy: Some Tentative Estimates," Journal of Industrial Economics, Wiley Blackwell, vol. 32(2), pages 113-30, December.
- Williamson, Oliver E, 1969. "Economies as an Antitrust Defense: Reply," American Economic Review, American Economic Association, vol. 59(5), pages 954-59, December.
- Carson, Richard, 1975. "On Monopoly Welfare Losses: Comment," American Economic Review, American Economic Association, vol. 65(5), pages 1008-14, December.
- Littlechild, S C, 1981. "Misleading Calculations of the Social Costs of Monopoly Power," Economic Journal, Royal Economic Society, vol. 91(362), pages 348-63, June.
- DePrano, Michael E & Nugent, Jeffrey B, 1969. "Economies as an Antitrust Defense: Comment," American Economic Review, American Economic Association, vol. 59(5), pages 947-53, December.
- Kenneth Arrow, 1962. "Economic Welfare and the Allocation of Resources for Invention," NBER Chapters, in: The Rate and Direction of Inventive Activity: Economic and Social Factors, pages 609-626 National Bureau of Economic Research, Inc.
- Flavio Delbono & Vincenzo Denicolo, 1988.
"Incentives to Innovate in a Cournot Oligopoly,"
44, Dipartimento Scienze Economiche, Universita' di Bologna.
- Neary, Hugh M., 1992. "Some general equilibrium aspects of a labor-managed economy with monopoly elements," Journal of Comparative Economics, Elsevier, vol. 16(4), pages 633-654, December.
- Worcester, Dean A, Jr, 1975. "On Monopoly Welfare Losses: Comment," American Economic Review, American Economic Association, vol. 65(5), pages 1015-23, December.
- Michael Reksulak & William F. Shughart & Robert D. Tollison, 2008. "Innovation and the opportunity cost of monopoly," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 29(8), pages 619-627.
- Posner, Richard A, 1975. "The Social Costs of Monopoly and Regulation," Journal of Political Economy, University of Chicago Press, vol. 83(4), pages 807-27, August.
- Bergson, Abram, 1973. "On Monopoly Welfare Losses," American Economic Review, American Economic Association, vol. 63(5), pages 853-70, December.
- Geroski, P A, 1990. "Innovation, Technological Opportunity, and Market Structure," Oxford Economic Papers, Oxford University Press, vol. 42(3), pages 586-602, July.
- Hansen, Claus Thustrup, 1999. "Second-best antitrust in general equilibrium: a special case," Economics Letters, Elsevier, vol. 63(2), pages 193-199, May.
- David Schwartzman, 1960. "The Burden of Monopoly," Journal of Political Economy, University of Chicago Press, vol. 68, pages 627.
- Hill, Martyn & Waterson, Michael, 1983. "Labor-managed Cournot oligopoly and industry output," Journal of Comparative Economics, Elsevier, vol. 7(1), pages 43-51, March.
- Cowling, Keith & Mueller, Dennis C, 1978. "The Social Costs of Monopoly Power," Economic Journal, Royal Economic Society, vol. 88(352), pages 727-48, December.
- Kay, J. A., 1983. "A general equilibrium approach to the measurement of monopoly welfare loss," International Journal of Industrial Organization, Elsevier, vol. 1(4), pages 317-331, December.
- Neary, Hugh M., 1984. ""Labor-managed cournot oligopoly and industry output": A comment," Journal of Comparative Economics, Elsevier, vol. 8(3), pages 322-327, September.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Magdalene Lim).
If references are entirely missing, you can add them using this form.