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Consumer Discrimination, Duopoly, and Black Firm Entry: The Welfare Effect of Subsidies

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  • Gregory N. Price

    (North Carolina A&T State University, Greensboro, NC.)

Abstract

Consumer discrimination, to the extent that it discourages the entry of Black-owned firms may be welfare reducing, as market output is lower than otherwise. This paper offers a simple model of duopoly in which conditions are derived for which a profit subsidy to Black-owned firms increases, decreases, or has no effect on social welfare.

Suggested Citation

  • Gregory N. Price, 1995. "Consumer Discrimination, Duopoly, and Black Firm Entry: The Welfare Effect of Subsidies," Industrial Organization 9505001, University Library of Munich, Germany.
    • Handle: RePEc:wpa:wuwpio:9505001
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    References listed on IDEAS

    as
    1. Becker, Gary S., 1971. "The Economics of Discrimination," University of Chicago Press Economics Books, University of Chicago Press, edition 2, number 9780226041162, April.
    2. Fishman, Arthur & Gandal, Neil, 1994. "Experimentation and learning with networks effects," Economics Letters, Elsevier, vol. 44(1-2), pages 103-108.
    3. Varian, Hal R., 1995. "Entry and cost reduction," Japan and the World Economy, Elsevier, vol. 7(4), pages 399-410, November.
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    Cited by:

    1. Gregory Price, 2005. "Consumer discrimination and black firm entry deterrence: Some reparable damage estimates," The Review of Black Political Economy, Springer;National Economic Association, vol. 32(3), pages 121-140, March.

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