3 ms·
In scenario 1 (monopoly): Only one company with worker w1, price p. prod_1 = punits / hours_w1 In scenario 2 (supplier + monopoly): Let's assume that the seco
by pengwing 5y ago
In scenario 1 (monopoly): Only one company with worker w1, price p.
prod_1 = punits / hours_w1
In scenario 2 (supplier + monopoly): Let's assume that the second company is not magic, but needs a worker to coordinate with the other company, mark up the price, etc.
prod_1 = (p-x)units/hours_w1
prod_2 = x*units/hours_w2
In summary, coordination between suppliers is an extra job which does not increase GDP. Productivity is decreased, because more hours are required to produce the same GDP.