Comparing Monopoly and Competition: The Increasing-Cost Case

Edgar Browning

Economic Inquiry, 1987, vol. 25, issue 3, 535-42

Abstract: When an increasing-cost competitive industry becomes monopolized, the monopoly will possess some monopsony power in input markets. This paper presents a simple analysis comparing the performance of monopoly and competition in this case. It first assumes fixed input proportions, and then turns to the general case o f variable input proportions. With variable proportions, it is shown that the monopoly's marginal cost curve lies above the competitive su pply curve but the monopoly's average cost curve lies below it. The w elfare cost of monopoly is not identified by the area between the mon opoly's marginal cost curve and the demand curve in either case. Copyright 1987 by Oxford University Press.

Date: 1987
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:oup:ecinqu:v:25:y:1987:i:3:p:535-42

Ordering information: This journal article can be ordered from
https://academic.oup.com/journals

Access Statistics for this article

Economic Inquiry is currently edited by Preston McAfee

More articles in Economic Inquiry from Western Economic Association International Oxford University Press, Great Clarendon Street, Oxford OX2 6DP, UK. Contact information at EDIRC.
Bibliographic data for series maintained by Oxford University Press ().