Production Efficiency and Income Distribution with Competition Induced by Antitrust Measures

Peter Josef Stauvermann and Ronald Kumar
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Peter Josef Stauvermann: Department of Global Business and Economics, Changwon National University, Changwon 51142, Republic of Korea

JRFM, 2023, vol. 16, issue 9, 1-23

Abstract: We use a three-sector overlapping generations model to examine the efficiency characteristics and income distribution in the long-run steady-state equilibrium. Assuming two sectors produce intermediate goods within an oligopolistic competition, we explore the implications for production efficiency and income distribution, given an increase in competition induced by antitrust measures. Our analysis presents the possibility of steady-state welfare under imperfect competition surpassing that of perfect competition when declining competition leads to a redistribution of income from older to younger generations. Nevertheless, greater competition (within oligopoly competition) consistently results in a more equitable income distribution.

Keywords: oligopolistic competition; market power; overlapping generations model; two-sector model (search for similar items in EconPapers)
JEL-codes: C E F2 F3 G (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (1)

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