Vaughan, R. (2004) Dynamic deadweight loss in monopolistic and related market structures. (ELSE Working Papers 114). ESRC Centre for Economic Learning and Social Evolution: London, UK.
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Abstract
The aim of the paper is to construct a framework in which welfare losses over time generated by alternative market structures may be estimated. An adjustment cost model of the firm under imperfect competition is developed, and consequent industry equilibria determined. A dynamic analogue of Harberger's measure of welfare loss is specified, and for the case of a monopoly industry can be expressed as a function solely of Tobin's average q. The welfare measures calculated are on the basis of the market's expectations of the future profitability of firms; such measures allow a significant additional set of data to be used to construct a forward looking measure of welfare loss, and thus augment existing measures of industry appraisal.
| Type: | Working / discussion paper |
|---|---|
| Title: | Dynamic deadweight loss in monopolistic and related market structures |
| Open access status: | An open access version is available from UCL Discovery |
| Publisher version: | http://else.econ.ucl.ac.uk/newweb/papers.php |
| Language: | English |
| UCL classification: | UCL > School of Arts and Social Sciences > Faculty of Social and Historical Sciences > Economics |
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