The paper shows that the co-movements of optimal price and output in a monopolistic market can be a case of spurious correlation, price and quantity variations being affect by the degree of uncertainty in the consumers' incomes. The pattern of price and quantity changes depends on the shape of...

Income distribution affects market demand and its elasticity, and, as a consequence, the optimal behaviour of firms and market equilibrium. This paper focuses on the effects of income polarization, and presents a model where - for any unimodal density function describing income distribution of...

Income distribution affects demand and its elasticity, and, as a consequence, the optimal behaviour of firms and market equilibrium. This paper focuses on the effects of income polarisation, and presents a model where - for any unimodal density function describing income distribution of the...

We analyze the direction of the co-movements of price and output in a monopolistic market when an expansive shock occurs. Price and quantity patterns are shown to depend on the consumers? income distribution. In particular, a low degree of income dispersion is associated with price and quantity...

Income distribution affects market demand and its elasticity, and, as a consequence, the optimal behaviour of firms and market equilibrium. This paper focuses on the effects of income polarization, and presents a model where - for any unimodal density function describing income distribution of...