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Aggregation with Cournot Competition: An Empirical Investigation

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  • Bertrand Koebel
  • François Laisney

Abstract

This paper empirically investigates the existence of Cournot equilibrium and the validity of the Le Chatelier-Samuelson (LCS) principle in the aggregate. Whereas two well known existence conditions are statistically rejected, we cannot reject a third, original, condition. We also find some empirical evidence for the LCS principle, as well as both increasing and constant returns to scale for two-digit US manufacturing industries. The results highlight the importance of imperfect competition for understanding aggregate growth, investment and employment.

Suggested Citation

  • Bertrand Koebel & François Laisney, 2016. "Aggregation with Cournot Competition: An Empirical Investigation," Annals of Economics and Statistics, GENES, issue 121-122, pages 91-119.
  • Handle: RePEc:adr:anecst:y:2016:i:121-122:p:91-119
    DOI: 10.15609/annaeconstat2009.121-122.91
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    File URL: http://www.jstor.org/stable/10.15609/annaeconstat2009.121-122.91
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    References listed on IDEAS

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    1. Bertrand Koebel & François Laisney, 2014. "Aggregation with Cournot Competition: the Le Chatelier Samuelson Principle," Annals of Economics and Statistics, GENES, issue 115-116, pages 343-360.

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    More about this item

    Keywords

    Aggregation; Le Chatelier-Samuelson Principle; Returns to Scale; Market Power; Markup; Own-Price Elasticity.;
    All these keywords.

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection

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