Monopoly innovation and welfare effects

Shuntian Yao and Lydia Gan

Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), 2010, vol. 4, No 2010-27, 21 pages

Abstract: In this paper we study the welfare effect of a monopoly innovation. Unlike many partial equilibrium models carried out in previous studies, general equilibrium models are constructed and analyzed in greater detail. We discover that technical innovation carried out by a monopolist could significantly increase the social welfare. We conclude that, in general, the criticism against monopoly innovation based on its increased deadweight loss is less accurate than previously postulated by many studies.

Keywords: Monopoly; technical innovation; welfare effects; general equilibrium (search for similar items in EconPapers)
JEL-codes: D50 D60 (search for similar items in EconPapers)
Date: 2010
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:ifweej:201027

DOI: 10.5018/economics-ejournal.ja.2010-27

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