A Note on Income Polarization and Free-Entry Equilibrium: United States versus European Union

Corrado Benassi, Roberto Cellini and Alessandra Chirco ()

Economia Internazionale / International Economics, 2000, vol. 53, issue 1, 15-21

Abstract: Income polarization and industry concentration (especially in sectors where price competition is supposed to be stiffer) are both generally deemed to be higher in the United States than in the European Union. In this note we provide an interpretation of this evidence by establishing a theoretical link, running from income polarization to industry concentration: the former may decrease the equilibrium number of firms, via its effect on market demand and elasticity within Cournot oligopoly.

Keywords: Oligopoly; Free Entry; Income Polarization (search for similar items in EconPapers)
JEL-codes: D31 D43 (search for similar items in EconPapers)
Date: 2000
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Persistent link: https://EconPapers.repec.org/RePEc:ris:ecoint:0253

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