Optimal Resource Allocation in General Cournot-competitive Equilibrium

Inger Sommerfelt Ervik and Christian Soegaard

No 270539, Economic Research Papers from University of Warwick - Department of Economics

Abstract: Conventional economic theory stipulates that output in Cournot competition is too low relative to that which is attained in perfect competition. We revisit this result in a General Cournot-competitive Equilibrium model with two industries that differ only in terms of productivity. We show that in general equilibrium, the more efficient industry produces too little and the less efficient industry produces too much compared to an optimal scenario with perfect competition.

Keywords: Financial; Economics (search for similar items in EconPapers)
Pages: 8
Date: 2013-06-19
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Related works:
Working Paper: OPTIMAL RESOURCE ALLOCATION IN GENERAL COURNOTCOMPETITIVE EQUILIBRIUM (2013)
Working Paper: Optimal Resource Allocation in General Cournot-competitive Equilibrium (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:uwarer:270539

DOI: 10.22004/ag.econ.270539

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