scholarly journals Bertrand Oligopoly And Factors Markets With Scarcity And Price Controls

2012 ◽  
Vol 10 (6) ◽  
pp. 355
Author(s):  
Randall E. Waldron ◽  
Michael A. Allgrunn
Keyword(s):  
Minimum Wage ◽  
Price Competition ◽  
Price Controls ◽  
Classroom Experiment ◽  
Differentiated Goods ◽  
Rental Rate ◽  
The One ◽  
Input Markets ◽  
Bertrand Oligopoly ◽  
Stable Outcome

In an earlier article, we reported the results of a classroom experiment simulating price competition in an oligopoly with differentiated goods. That study raised some questions that we were unable to address at that time. For this current study, we have adapted the experiment to further explore the effects of scarcity in the input markets, and to study the effects of price controls in these markets. We find that scarcity in an input market has the expected directional effect on prices in both input and output markets, but not necessarily the magnitude expected; we further find that price controls have only some of the effects expected. In the current experiment, we increased the number of rounds of the game to allow more opportunity for convergence to a stable outcome, and to allow for three distinct phases of the game: initial rounds in which inputs were abundantly available, subsequent rounds in which one inputs supply was dramatically reduced, and final rounds in which a price floor was established on the one input which remained abundant. As expected, firms played Nash/Bertrand strategies in the early rounds. However, the shock caused by reducing the availability of capital took many rounds for full adjustment, with both output prices and the equilibrium rental rate of capital rising consistently and gradually toward their projected equilibria over ten rounds, although even then capital prices did not rise enough to absorb all firm profits. Surprisingly, establishing a minimum wage did not have the anticipated effect of balancing payments between labor and capital; instead, the minimum wage completely disrupted the trend of an increasing rental price of capital and reduced it to zero, while creating volatility in profits without consistently eliminating them. Overall, we find that most of our anticipated results ultimately obtain, but adjustments to variations in market conditions are neither immediate nor perfectly consistent with the predictions of theory.

scholarly journals Finnish alcohol policy reform: battle over public health objectives

2019 ◽  
Vol 29 (Supplement_4) ◽  
Author(s):  
P Mäkelä
Keyword(s):  
Public Health ◽  
Price Competition ◽  
Interrupted Time Series ◽  
Alcohol Policy ◽  
First Year ◽  
Grocery Stores ◽  
Interrupted Time Series Analysis ◽  
The One ◽  
Health Objectives ◽  
Physical Availability

Abstract A new Alcohol Act came into force in Finland in 2018. The preparation of a comprehensive reform of the alcohol legislation was started already in 2011. The aim of Finnish alcohol policy has been to reduce alcohol-related harm, and the central means to do that have been by way of high taxation and restrictions in the physical availability of alcohol, in which the state alcohol monopoly has had a central role. The process of reforming the act was a long battle between forces that wished to continue underlining the public health aims and using efficient tools to reach those aims on the one hand, and neoliberal politicians aligned with the strong alcohol industry lobby and enthusiasts in social media who wished to get rid of regulation. The new Act somewhat expanded the rights of grocery stores to sell alcohol and de-regulated the on-premise trade by dismantling regulations in the old legislation. The retail state monopoly was weakened as a result, but it still has an important impact on restricting the physical availability of alcohol. Previously when alcohol has been made more available, consumption has increased, and also this time this was the expected outcome. However, an interrupted time series analysis has shown no statistically significant effect of the law change in the first year. One central explanation seems to be that price competition has been less intense than expected. Nonetheless, despite the fact that alcohol taxes were raised, a 10-year downward trend in alcohol consumption from 2008 to 2017 was halted.

COMPARATIVE STATICS ON ONLINE COMPETITION AND INTERNET TAXATION

2006 ◽  
Vol 51 (02) ◽  
pp. 229-240
Author(s):  
SANG-HO LEE
Keyword(s):  
Price Competition ◽  
Relative Size ◽  
Comparative Statics ◽  
Tax Revenue ◽  
The Internet ◽  
Equilibrium Prices ◽  
Differentiated Goods ◽  
Goods Market ◽  
Online Access ◽  
Commodity Tax

This paper analyzes price competition in a differentiated goods market between online and offline firms, and compares equilibrium prices, market demands, and profits of the firms. We also investigate the effects of a commodity tax on offline firms and Internet taxes on online firm regarding government tax revenue. We demonstrate that tax revenue depends not only on the relative size of online access and offline transportation costs, but also on the maturity of e-commerce. Under the Internet Tax Freedom Act, in particular, we show that (i) when the offline commodity tax is large, tax revenue decreases with the maturity of e-commerce market increases, and (ii) when the offline commodity tax is small, tax revenue decreases first and then increases with the maturity of e-commerce market.

scholarly journals Experiments In Bertrand Competition With Factor Markets

2010 ◽  
Vol 8 (3) ◽  
Author(s):  
Randall E. Waldron ◽  
Michael A. Allgrunn ◽  
Guoqiang Pei
Keyword(s):  
Student Satisfaction ◽  
Product Differentiation ◽  
Price Competition ◽  
Student Behavior ◽  
Student Understanding ◽  
Font Size ◽  
Market Outcomes ◽  
Classroom Experiment ◽  
Factor Markets ◽  
Bertrand Price Competition

<p class="MsoNormal" style="text-justify: inter-ideograph; text-align: justify; margin: 0in 0.5in 0pt; mso-pagination: none;"><span style="font-size: 10pt;"><span style="font-family: Times New Roman;">We present a classroom experiment which introduces product differentiation and factor markets into the traditional Bertrand framework.<span style="mso-spacerun: yes;">&nbsp; </span>We find that student behavior converges toward the market outcomes predicted by theory.<span style="mso-spacerun: yes;">&nbsp; </span>We also find that the experiment enhances student understanding of Bertrand price competition in a market with product differentiation and factor markets, and also appears to increase student satisfaction.</span></span></p>

scholarly journals Assuring SME’s Sustainable Competitiveness in the Digital Era: A Labor Policy between Guaranteed Minimum Wage and ICT Skill Mismatch

2019 ◽  
Vol 11 (10) ◽  
pp. 2918 ◽  
Author(s):  
Alexandru Avram ◽  
Marco Benvenuto ◽  
Costin Daniel Avram ◽  
Ginevra Gravili
Keyword(s):  
Minimum Wage ◽  
Information And Communication Technologies ◽  
Small And Medium Enterprises ◽  
Integrated Approach ◽  
Labor Policy ◽  
Information And Communications Technology ◽  
Human Labor ◽  
Skills Mismatch ◽  
The One ◽  
Medium Enterprises

The aim of this paper is to analyze the real impact of ICT (Information and Communications Technology) skills mismatch on SME’s (small and medium enterprises) sustainable competitiveness in the presence of a guaranteed minimum wage. As part of public policies—the minimum wage needs to maintain a balance between increasing employment and not being a burden for the companies, leading them to bankruptcies, especially in times of disruptive change, in which economies have to be more resilient. The rapid progress in information and communication technologies has dramatically redefined rising unemployment as a result of skills mismatch. This paper aims to understand, on the one hand, whether there is a match between the supply demand of ICT skills, and how increasingly powerful digital technologies affect the skills, jobs, and demand for human labor. On the other hand, it aims to understand whether increasing productivity and a fair minimum wage could be an integrated approach for stimulating SME’s in increasing sustainable competitiveness.

Globalization and Social Justice: The Right to Minimum Wage

2009 ◽  
Vol 3 (2) ◽  
pp. 267-300
Author(s):  
Hani Ofek-Ghendler
Keyword(s):  
Minimum Wage ◽  
Codes Of Conduct ◽  
Labor Law ◽  
Transnational Corporations ◽  
Fundamental Principle ◽  
Labor Rights ◽  
State Regulations ◽  
International Labor ◽  
The One ◽  
The Right

The weakening of mechanisms for international cooperation within the context of the right to minimum wage can be explained by the increasing power of new players, the transnational corporations on the one hand, and the waning of the power of the state, on the other hand. These processes of globalization produce various challenges to the modern welfare state, such as the ability to attain minimum wage. This right is vital particularly to weakened workers that would otherwise be remunerated at a very low wage, which could likely lead to poverty. This right poses, however, numerous challenges, in particular the ability of international labor law to define it across borders. The article describes three models for defining this right: the existential deficiency model, the welfare model, and the comfort model and analyzes the various forms regulating the right to minimum wage in international regulations, state regulations, and codes of conduct of transnational corporations examining the ramifications of globalization within the context of labor rights. Moreover, the article suggests changes to international labor law, required to ensure that it functions as an effective instrument in protecting labor rights and proposes establishing regional parliaments—a supra-governmental body—composed of states and a broad array of interested private parties in its activities to establish fundamental principles relating to various areas of life, such as the basic rights of workers, taxation principles, and principles for protecting the environment. These regional bodies would decide which of the various models used for shaping the right to minimum wage should be adopted as a fundamental principle.

scholarly journals Analisis Determinan Tingkat Pengangguran Terbuka di Pulau Jawa Tahun 2007-2016

2019 ◽  
Vol 6 (1) ◽  
pp. 43
Author(s):  
Wildan Aziz Amrullah ◽  
Nanik Istiyani ◽  
Fivien Muslihatinningsih
Keyword(s):  
Panel Data ◽  
Minimum Wage ◽  
Unemployment Rate ◽  
Inflation Rate ◽  
Fixed Effect Model ◽  
Complex Problem ◽  
Test Analysis ◽  
Prevailing Wage ◽  
Wage Inflation ◽  
The One

Unemployment is a complex problem because it's affecting and influenced by many factors that interact with each other following patterns that are not easy to understand. The problem of unemployment is the one result of the existence of economic phenomena that occur. The rate of unemployment can be influenced by several indicators, such as the amount of prevailing wage, The GDP, and inflation rate. The aim of this research is to know how big influence of the GDP, Province Minimum Wage and inflation rate on open unemployment in every province in Java Island Year 2007-2016. The method analysis of this research using Panel data with using Fixed Effect Model (FEM) approach. The result of panel data regression showed simultaneously that the variables of tghe GDP, Province Minimum Wage, and inflation have significant, The result of partial test analysis showed that The GDP has significant influence, while province Minimum Wage and inflation have a negative and insignificant on open unemployment Rate in Java Island period 2007-2016. The total variation in open unemployment rate in Java Island province can be explained by independent variables of PDRB, UMP and inflation at 93.35%. Keywords: Open Unemployment Rate, The GDP, Province Minimum Wage, Inflation.

scholarly journals Measuring Productivity Dispersion

2018 ◽  
pp. 592-624
Author(s):  
Eric J. Bartelsman ◽  
Zoltan Wolf
Keyword(s):  
Empirical Evidence ◽  
The Other ◽  
Resource Reallocation ◽  
Methodological Issues ◽  
Or Efficiency ◽  
The One ◽  
Selection Mechanisms ◽  
Input Markets ◽  
Over Time ◽  
Selection Of

Measuring the dispersion of productivity or efficiency across firms in a market or industry is rife with methodological issues. Nevertheless, the existence of considerable dispersion now is well documented and widely accepted. Less well understood are the economic features and mechanisms underlying the magnitude of dispersion and how dispersion varies over time or across markets. On the one hand, selection mechanisms in both output and input markets should favor the most productive units through resource reallocation, thereby reducing dispersion. On the other hand, innovation and technological uncertainty tend to increase dispersion. This chapter presents a guide to the measurement of dispersion and provides empirical evidence from a selection of countries and industries using a variety of methodologies.

scholarly journals Understanding Price Controls and Nonprice Competition with Matching Theory

2012 ◽  
Vol 102 (3) ◽  
pp. 371-375 ◽  
Author(s):  
John William Hatfield ◽  
Charles R Plott ◽  
Tomomi Tanaka
Keyword(s):  
Price Competition ◽  
Competition Model ◽  
Matching Theory ◽  
Quality Competition ◽  
High Quality ◽  
Market Outcomes ◽  
Price Controls ◽  
Nonprice Competition ◽  
Competitive Equilibria

We develop a quality competition model to understand how price controls affect market outcomes in buyer-seller markets with discrete goods of varying quality. While competitive equilibria do not necessarily exist in such markets when price controls are imposed, we show that stable outcomes do exist and characterize the set of stable outcomes in the presence of price restrictions. In particular, we show that price controls induce non-price competition: price floors induce the trade of inefficiently high quality goods, while price ceilings induce the trade of inefficiently low quality goods.

The Core in Bertrand Oligopoly TU-Games with Transferable Technologies

2019 ◽  
Vol 20 (1) ◽  
Author(s):  
Aymeric Lardon
Keyword(s):  
Monotonicity Property ◽  
Convexity Property ◽  
Efficient Technology ◽  
Tu Games ◽  
The Core ◽  
Convex Cover ◽  
The Difference ◽  
The One ◽  
Bertrand Oligopoly ◽  
Equal Division Solution

AbstractIn this article we study Bertrand oligopoly TU-games with transferable technologies under the α and β-approaches. We first prove that the core of any game can be partially characterized by associating a Bertrand oligopoly TU-game derived from the most efficient technology. Such a game turns to be an efficient convex cover of the original one. This result implies that the core is non-empty and contains a subset of payoff vectors with a symmetric geometric structure easy to compute. We also deduce from this result that the equal division solution is a core selector satisfying the coalitional monotonicity property on this set of games. Moreover, although the convexity property does not always hold even for standard Bertrand oligopolies, we show that it is satisfied when the difference between the marginal cost of the most efficient firm and the one of the least efficient firm is not too large.

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