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That review mentions output restriction 15 times in total, the implied argument being that monopolies and cartels restrict output at some point of the demand c
by carlsborg 7y ago
That review mentions output restriction 15 times in total, the implied argument being that monopolies and cartels restrict output at some point of the demand curve and there is no output restriction these are not real monopolies.
Imho this is not a useful argument without also offering the marginal cost curve for that industry. Ie maybe for airlines technology driven efficiencies allows marginal revenue to exceed marginal cost at scale? From elsewhere “A monopolist can determine its profit-maximizing price and quantity by analyzing the marginal revenue and marginal costs of producing an extra unit. If the marginal revenue exceeds the marginal cost, then the firm should produce the extra unit.”