On the Profitability of Production Constraints in a Dynamic Natural Resource Oligopoly

Static oligopoly analysis predicts that if a single firm in Cournot equilibrium were to be constrained to contract its production marginally, its profits would fall. on the other hand, if all the firms were simultaneously constrained to reduce their productino, thus moving the industry towards monopoly output, each firm's profit would rise. We show that these very intuitive results may not hold in a dynamic oligopoly.

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Year of publication:	1997
Authors:	BENCHEKROUN, Hassan ; GAUDET, Gérard
Institutions:	Département de Sciences Économiques, Université de Montréal

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Extent:	application/pdf
Series:	Cahiers de recherche.
Type of publication:	Book / Working Paper
Notes:	20 pages
Classification:	L10 - Market Structure, Firm Strategy, and Market Performance. General
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005170703