Technology improvement and market structure alteration

Sugata Marjit, Suryaprakash Misra, Dyuti S. Banerjee

Research output: Contribution to journalArticleResearchpeer-review

Abstract

In this paper we show that the increasing marginal cost assumption removes the infeasibility of market structurealteration that is present under the constant marginal cost assumption. Specifically, in an infinitely repeated game withincreasing marginal cost, we show that technological improvement has the potential to switch the market structurefrom collusion to Cournot generating additional welfare gains.

Original languageEnglish
Pages (from-to)1106-1112
Number of pages7
JournalEconomics Bulletin
Volume37
Issue number2
Publication statusPublished - 2017

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