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Just One Of Us: Consumers Playing Oligopoly In Mixed Markets


  • Marco Marini
  • Alberto Zevi

    () (University of Urbino "Carlo Bo", University of Roma "La Sapienza")


Consumer 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.

Suggested Citation

  • Marco Marini & Alberto Zevi, 2011. "Just One Of Us: Consumers Playing Oligopoly In Mixed Markets," Working Papers 0111, CREI Università degli Studi Roma Tre, revised 2011.
  • Handle: RePEc:rcr:wpaper:01_11

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    References listed on IDEAS

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    Cited by:

    1. Michael Kopel & Marco Marini, 2014. "Strategic delegation in consumer cooperatives under mixed oligopoly," Journal of Economics, Springer, vol. 113(3), pages 275-296, November.
    2. repec:eee:ecosys:v:41:y:2017:i:1:p:86-97 is not listed on IDEAS
    3. Marco A. MARINI & Paolo POLIDORI & Desiree TEOBALDELLI & Alberto ZEVI, 2015. "Welfare Enhancing Coordination In Consumer Cooperatives Under Mixed Oligopoly," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 86(3), pages 505-527, September.
    4. Saha, Souresh, 2014. "Firm's objective function and product and process R&D," Economic Modelling, Elsevier, vol. 36(C), pages 484-494.
    5. Michael Kopel & Marco Marini, 2012. "Optimal Compensation Structure In Consumer Cooperatives Under Mixed Oligopoly," Working Papers 0512, CREI Università degli Studi Roma Tre, revised 2012.
    6. Kopel, Michael & Brand, Björn, 2012. "Socially responsible firms and endogenous choice of strategic incentives," Economic Modelling, Elsevier, vol. 29(3), pages 982-989.
    7. Rudy Santore & Youping Li & Stephen Cotten, 2015. "Colluding with a conscience," Journal of Economics, Springer, vol. 114(3), pages 255-269, April.

    More about this item


    Consumer Cooperatives; Pro?t-maximizing Firms; Mixed Oligopoly;

    JEL classification:

    • 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

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