Just One Of Us: Consumers Playing Oligopoly In Mixed Markets
AbstractConsumer cooperatives constitute a highly successful example of democratic forms of enterprises operating in developed countries. They are usually organized as medium and large-scale ?rms competing with pro?t-maximizing ?rms in retail industries. This paper models such situation as a mixed oligopoly in which consumer cooperatives maximize the utility of consumer-members and distribute them a share of the pro?t equal to the ratio of their individual expenditure to the ?rm total sales. We show that when consumers possess quasilinear preferences over a bundle of symmetrically di¤erentiated goods and ?rms operate with a linear technology, the presence of consumer cooperatives a¤ects all industries output and social welfare positively. The e¤ect of cooperatives on welfare proves more signi?cant when goods are either complements or highly di¤erentiated and when competition is à la Cournot rather than à la Bertrand.
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Bibliographic InfoPaper provided by CREI Università degli Studi Roma Tre in its series Working Papers with number 0111.
Length: 25 pages
Date of creation: 2011
Date of revision: 2011
Consumer Cooperatives; Pro?t-maximizing Firms; Mixed Oligopoly;
Other versions of this item:
- Marco Marini & Alberto Zevi, 2011. "‘Just one of us’: consumers playing oligopoly in mixed markets," Journal of Economics, Springer, vol. 104(3), pages 239-263, November.
- Marco, Marini & Alberto, Zevi, 2010. "'Just one of us': Consumers playing oligopoly in mixed markets," MPRA Paper 31213, University Library of Munich, Germany, revised 30 May 2011.
- D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
- I30 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General
- P13 - Economic Systems - - Capitalist Systems - - - Cooperative Enterprises
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
- D01 - Microeconomics - - General - - - Microeconomic Behavior: Underlying Principles
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-02-19 (All new papers)
- NEP-CIS-2011-02-19 (Confederation of Independent States)
- NEP-COM-2011-02-19 (Industrial Competition)
- NEP-MKT-2011-02-19 (Marketing)
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