Tight Average Revenue Regulation Can Be Worse Than No Regulation.
Price regulation of a multimarket monopolist, with the cap based on average revenue, can cause welfare to be below the unregulated level. In a model with linear demands and constant but unequal marginal costs, a sufficient condition for this welfare effect is that the cap equals the average revenue...
| Main Author: | |
|---|---|
| Format: | Journal article |
| Language: | English |
| Published: |
1997
|