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Market competition, social welfare in an entry-constrained differentiated-good oligopoly

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  • Koh, Winston T.H.

Abstract

This paper studies a differentiated-good oligopoly where the socially optimal number of firms (varieties) may be smaller or greater than under the free-entry equilibrium. We show that, under certain conditions, social welfare may be higher when entry is restricted into the industry.

Suggested Citation

  • Koh, Winston T.H., 2008. "Market competition, social welfare in an entry-constrained differentiated-good oligopoly," Economics Letters, Elsevier, vol. 100(2), pages 229-233, August.
    • Handle: RePEc:eee:ecolet:v:100:y:2008:i:2:p:229-233
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    References listed on IDEAS

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    1. Avinash Dixit, 1979. "A Model of Duopoly Suggesting a Theory of Entry Barriers," Bell Journal of Economics, The RAND Corporation, vol. 10(1), pages 20-32, Spring.
    2. Nirvikar Singh & Xavier Vives, 1984. "Price and Quantity Competition in a Differentiated Duopoly," RAND Journal of Economics, The RAND Corporation, vol. 15(4), pages 546-554, Winter.
    3. Hackner, Jonas, 2000. "A Note on Price and Quantity Competition in Differentiated Oligopolies," Journal of Economic Theory, Elsevier, vol. 93(2), pages 233-239, August.
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    Cited by:

    1. Pinopoulos, Ioannis N., 2011. "Input pricing by an upstream monopolist into imperfectly competitive downstream markets," Research in Economics, Elsevier, vol. 65(3), pages 144-151, September.
    2. Jens Jurgan, 2009. "Cost Variations in a Differentiated Good Oligopoly," Working Papers 069, Bavarian Graduate Program in Economics (BGPE).
    3. Chang Yee Kwan, 2013. "Preferences, Welfare and Desirable Subsidies under Monopolistic Competition," Metroeconomica, Wiley Blackwell, vol. 64(4), pages 744-759, November.
    4. Jurgan, Jens, 2009. "Conjectural cost variations in a differentiated good oligopoly," W.E.P. - Würzburg Economic Papers 80, University of Würzburg, Department of Economics.

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