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How large are double markups?

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  • Duran-Micco, Elisa
  • Perloff, Jeffrey M.

Abstract

Because prices exceed marginal costs in many upstream and downstream industries, downstream prices often reflect a double markup. This paper estimates the size of double markups across many industries accounting for direct and indirect upstream markups. The double markups in many U.S. manufacturing industries are significant because of large upstream and downstream markups and increasing returns to scale.

Suggested Citation

  • Duran-Micco, Elisa & Perloff, Jeffrey M., 2022. "How large are double markups?," International Journal of Industrial Organization, Elsevier, vol. 85(C).
    • Handle: RePEc:eee:indorg:v:85:y:2022:i:c:s0167718722000613
    DOI: 10.1016/j.ijindorg.2022.102885
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    More about this item

    Keywords

    Double markup; Market pricing; Consumer surplus;
    All these keywords.

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • L12 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Monopoly; Monopolization Strategies
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • D57 - Microeconomics - - General Equilibrium and Disequilibrium - - - Input-Output Tables and Analysis

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