The Competitive Foundations of Price Cap Regulation

被引：0
|
作者：
Weisman, Dennis L. [1 ]
机构：
[1] Kansas State Univ, Dept Econ, Manhattan, KS 66506 USA
来源：
B E JOURNAL OF ECONOMIC ANALYSIS & POLICY | 2023年 / 23卷 / 02期
关键词：
cost-reducing innovation; pass-through; price cap regulation; Cournot competition; INCENTIVE REGULATION;
D O I：
10.1515/bejeap-2022-0052
中图分类号：
F [经济];
学科分类号：
02 ;
摘要：
Price cap regulation (PCR) as commonly implemented closely approximates atomistic Cournot competition in terms of the pass-through of industry and firm-specific cost-reducing innovation when the invariance property holds. A key finding is that the aggregate pass-through of cost-reducing innovation under PCR exceeds that under Cournot, holding the number of firms constant. The welfare gains under PCR are greater than Cournot when cost-reducing innovation is endogenous, the invariance property holds and demand is highly inelastic.
引用
收藏
页码：497 / 513
页数：17
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