Increasing Returns and Efficiency

Increasing Returns and Efficiency

by Martine Quinzii
     
 

ISBN-10: 0195065530

ISBN-13: 9780195065534

Pub. Date: 01/28/1993

Publisher: Oxford University Press, USA


Increasing returns to scale is an area in economics that has recently become the focus of much attention. While most firms operate under constant or decreasing return to scale on their relevant range of production, some firms produce goods or services with a technology which exhibits increasing returns to scale at levels of production which are large relative to…  See more details below

Overview


Increasing returns to scale is an area in economics that has recently become the focus of much attention. While most firms operate under constant or decreasing return to scale on their relevant range of production, some firms produce goods or services with a technology which exhibits increasing returns to scale at levels of production which are large relative to the market. These goods are an important component of economic activity in a modern economy and are typically commodities produced either by a public sector or, as in the U.S., by regulated utilities. In this study, the author analyzes increasing returns using general equilibrium theory to take into account the interactions between production in the public and the private sector, and the effects of financing the public sector on the redistribution of income.

Product Details

ISBN-13:
9780195065534
Publisher:
Oxford University Press, USA
Publication date:
01/28/1993
Pages:
176
Product dimensions:
6.31(w) x 9.56(h) x 0.78(d)
Lexile:
1500L (what's this?)

Table of Contents

1Introduction3
1.1Origin of Ideas3
1.2Recent Developments8
2Necessary Conditions for Efficiency13
2.1The Production Economy13
2.2Supporting Prices for Efficient Allocations16
2.3Clarke Normal Cone18
2.4Existence of Supporting Prices21
2.5Marginal Cost pricing23
3Marginal Cost Pricing Equilibrium27
3.1Organization of Decisions27
3.2Covering Deficits28
3.3Two-Part Tariffs31
3.4Marginal Cost Pricing Equilibrium39
4Efficiency41
4.1Inefficiency of All Equilibria41
4.2Abstract Condition for Efficiency47
4.3Elasticity Condition for Efficiency (One Output)53
4.4Examples64
4.5Elasticity Condition for Efficiency (Many Outputs)67
5Existence77
5.1Single Firm Existence Theorem77
5.2Example of Productive Inefficiency83
5.3General Existence Theorem87
5.4Structure of set E[subscript[epsilon]]90
5.5Proof of the Existence Theorem96
6The Core101
6.1Why the Core?101
6.2Cooperative Game Theory103
6.3Scarf's Negative Result106
6.4One Input, One Output116
6.5Many Inputs, One Output120
6.6Many Inputs, Many Outputs137
7Conclusion153
References155
Index161

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