Monopoly innovation and welfare effects

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.

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Year of publication:	2010
Authors:	Yao, Shuntian ; Gan, Lydia
Published in:	Economics: The Open-Access, Open-Assessment E-Journal. - Kiel : Kiel Institute for the World Economy (IfW), ISSN 1864-6042. - Vol. 4.2010, 2010-27, p. 1-21
Publisher:	Kiel : Kiel Institute for the World Economy (IfW)
Subject:	Innovation \| Monopol \| Wohlfahrtseffekt \| Allgemeines Gleichgewicht \| Theorie \| Monopoly \| technical innovation \| welfare effects \| general equilibrium

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Type of publication:	Article
Type of publication (narrower categories):	Article
Language:	English
Other identifiers:	10.5018/economics-ejournal.ja.2010-27 [DOI] 636119645 [GVK] hdl:10419/41560 [Handle] RePEc:zbw:ifweej:201027 [RePEc]
Classification:	D50 - General Equilibrium and Disequilibrium. General ; D60 - Welfare Economics. General
Source:	EconStor

Persistent link: https://www.econbiz.de/10010302705