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Competition

Author

Listed:
  • Boone, J.

    (Tilburg University, Center For Economic Research)

Abstract

Competition has been modelled in economic literature in a number of ways. What do these different parameterizations of competition have in common? For instance, it turns out that it is not always the case that a rise in competition reduces price cost margins, industry wide profits or concentration. All parameterizations of competition, considered here, have two features in common. First, the reallocation effect: a rise in competition raises the profits of a firm relative to the profits of a less efficient firm. Second, a rise in competition reduces the profits of the least efficient firm active in the industry.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Boone, J., 2000. "Competition," Discussion Paper 2000-104, Tilburg University, Center for Economic Research.
  • Handle: RePEc:tiu:tiucen:ea721365-968f-4ab9-a1fb-aaed08b68098
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    competition; industrial concentration; profit;

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets

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