Monopoly Research Articles

Global Innovation Contests

The primary objective of this paper is to develop a two-country, dynamic, general equilibrium model with innovation contests to formally analyze the impact of globalization on the skill premium and fully-endogenous growth. Higher quality products are endogenously discovered through stochastic and sequential global innovation contests in which challengers devote resources to R&D, while technology leaders undertake rent-protection activities (RPAs) to prolong the expected duration of their temporary monopoly power by hindering the R&D effort of challengers. The model generates intra-sectoral trade, multinationals, and international outsourcing of investment services. Globalization, captured by a move from autarky to the integrated-world equilibrium, leads to convergence of wages and growth rates. Globalization and long-run growth are either substitutes or complements depending on a country’s relative skill abundance and the ranking of skill intensities between RPAs and R&D services. Trade openness between two countries that possess identical relative skill endowments but differ in size does not affect either country’s long-run growth.

The Hungarian insurance market structure: an empirical analysis

This paper analyzes the market structure of the Hungarian insurance market, which operated as a monopoly market until 1986. After the regime change this sector started to develop rapidly. But the Hungarian insurance market has a strong oligopolistic character, and thus raises an interesting question as to how close the market is to a state of perfect competition. Based on the Panzar and Rosse (J Ind Econ 35:443–456, 1987) methodology we estimate the elasticity of total revenues with respect to changes in input prices, so that we can determine the market structure. The estimation of input price elasticity is made with a static and a dynamic panel model. According to research the structure of the Hungarian insurance market significantly differs from the perfect competition case between 2010 and 2019. The market is in long-run equilibrium, and the hypothesis of the monopoly case cannot be rejected. The market structure of a sector is important for modelling phenomena and new regulations effectively, which is relevant for insurance and competition supervision in the protection of customers.

The Analysis of the Harm Caused by Companies Influencing the Spread of Public Crises for Profit in Monopolistic Competitive Markets

It is well known that public crises pose a threat to all citizens of an area, including threats to human safety, property damage, social panic, etc. Public crises are sometimes inevitable, but in a monopolistic competitive market, some companies make profits by influencing the spread of public crises. Such behavior sometimes increases the threat of public crises to citizens, expands the scope of public crises, and even creates new public crises. This paper attempts to analyze the relationship between companies and the spread of public crises under the monopolistic competitive market. First is to define the public crisis and the monopolistic competitive market, then discuss how companies affect the spread of the public crisis under the monopoly market competition, what its purpose is, and what kind of impact it will have on citizens. Finally, this paper will propose ways to reduce the harm that companies do to the spread of public crises.

Alternating-Offers Bargaining with Nash Bargaining Fairness Concerns

The Rubinstein alternating-offers bargaining game is reconsidered, where players show fairness concerns and their fairness references are characterized by the Nash bargaining solution. The objective of this paper is to explore the impact of fairness concerns in the alternating-offer bargaining game. Alternating-offer bargaining with fairness concerns is developed. We construct a subgame perfect equilibrium and show its uniqueness. Then, it is shown that players' payoffs in the subgame perfect equilibrium are positively related to their own fairness concern coefficient and bargaining power and negatively to the opponents' fairness concern coefficient. Moreover, it is shown that the limited equilibrium partition depends on the ratio of discount rates of the two players when the time lapse between two offers goes to zero. Finally, the proposed model is applied to the bilateral monopoly market of professional basketball players, and some properties of equilibrium price are shown. Our result provides the implication that players should carefully weigh their own fairness concerns, bargaining power and fairness concerns of their opponents, and then make proposals, rather than simply follow the suggestion that the proposal at the current stage is higher than that at the past stages.

A dynamic analysis of a monopolist's product and process innovation with nonlinear demand and expected quality effects

<p style='text-indent:20px;'>The purpose of this paper is to investigate the dynamic control problems of a firm's product innovation (quality-improving) and process innovation (cost-reducing) with expected quality (reference quality) effects under nonlinear demand in a monopoly market. Our work significant features are: (i) a monopolist dealing with customer behavior in the spirit of behavioral economics determines the product quality, and carries out product and process innovation activities over time; (ii) the consumers' demand structure depends on product quality, expected quality and price in a separable multiplicative way between state variables and control variable. Our main results show (i) under monopolist decision-making and social planner adjustment, the stability of the system depends on the discount rate and consumers' memory parameter; (ii) the effort rate of process innovation is increasing with the expected quality, while the effort rate of product innovation is increasing with the memory parameter in the neighborhood of the steady-state shadow price of expected quality; (iii) as the memory parameter increases, the steady-state effort of process innovation is greater than that of product innovation; (iv) although the price is still determined by the monopolist under social planner adjustment, the price as well as both the efforts of product and process innovation under the social planner adjustment are always higher than that under the monopolist decision-making.</p>

New Product Introductions with Selection of Unique and Common Features in Monopoly Markets

New Product Introductions with Selection of Unique and Common Features in Monopoly Markets

The New Political Economy of Regulation

The new political economy of regulation is related to the establishment of a balanced regulatory framework that contributes to the synthesis of political and economic aspects. The political economy of regulation also contributes to the establishment of direct governance and controlling processes on economic activities by public sector agents. The aim of the paper is to analyse the new political economy of regulation. Based on a secondary qualitative and detective approach, the article studied the scope and advantages of the new political economy on regulations and its implications within a capitalist structure. A thematic analysis is also conducted to indicate that the new political economy of regulations contributes to establishing a framework for monitoring and distributing wealth, resources and knowledge fairly in all strata of society. Market monopoly is demolished while agricultural and corporate sectors are aligned in their operations to bridge the economic and political gap between the rich and the poor segment of society. Thus, it is concluded that the new political economy provides valuable principles for a balanced and systematising regulatory framework in which capitalist extremism and structural poverty are addressed, contributing to the socialist distribution of resources.

Clean Energy Contributes to Poverty Alleviation in China

Poverty has long plagued humanity. The main factors affecting the gap between the rich and the poor are natural resources, human resources, information resources and science and technology. Using data from various clean energy industries and historical research methods, this paper shows that the clean energy industry is a new way to reduce poverty in developing countries. In the history of agricultural development, land and water resources are the important sources of wealth growth. In the history of industrial development, mineral resources, coal and oil energy have become the material basis for getting rich. In the 21st century with the great development of artificial intelligence, the importance of power resources is becoming more and more prominent, and clean energy such as solar energy and wind energy has become a new natural resource to create social wealth. Chinese successful practice in the development of clean energy industry shows that the clean energy industry is an effective way to get out of poverty. The results of the cooperation between China and African countries in developing clean energy industries show that the energy industry plays an increasingly important role in helping developing countries out of poverty. Although the development of clean energy industry is still restricted by market competition and monopoly organizations, the development road is still tortuous and long, it has a very bright future.

The 'Arab Spring’ as a challenge to the Weberian analysis of Islam

The purpose of this paper is the application of some Weberian conceptual categories to the contemporary Islamic world. The reconstruction of Weberian thought on the religion of Muhammad seems to retain some heuristic capacity: although modified over time, the organization of Islam gave rise to dynasties with charismatic political leadership who constituted patrimonial-sultanistic forms of power, with their own armies and personal bureaucracy. Characteristics of this type can be traced in the Maghreb and Mashriq countries, where there was an almost exclusive monopoly of power by the state and the prevalence of personal relationships over institutions. A political form that Weber described in terms of neo-patrimonial societies, with a strong role of the charismatic figure of the leader, a society conceived as a collection of groups and not individuals, a centralization of power by the state, and a private and clientelistic management of economic resources by ruling elites. The Arab revolutions of 2010 can be read as a struggle against this neo-patrimonialist model in countries such as Egypt, Tunisia, and Syria. More than a decade after the outbreak of the revolutions, the purpose of this paper is to examine whether indeed these countries have overcome those obstacles to modernization and development identified by the German sociologist in Islamic societies.

Absolute Monopoly Power: Life and Death at the Margin

Absolute Monopoly Power: Life and Death at the Margin

Internet Head Enterprises of the Monopoly Media Reports Analysis

This paper takes the monopoly of relevant domestic Internet enterprises as a case to climb the market share analysis of Tencent, Meituan, Sina Weibo and other Internet enterprises through network crawler technology, as well as the social influence as a sample framework analysis and classification by data comparison and desktop research. Research found that the Internet rapid popularization of digital economy development now, Internet companies in steady economic growth at the same time also strengthen the Internet head enterprise market monopoly, Internet head companies abuse market position forced or restrict trading, bundling, monopoly pricing and a series of monopoly behavior also have negative impact on market efficiency[1].

The Influence Mechanism of a Self-Governing Organization in the Logistics Industry Based on the Tripartite Evolutionary Game Model

As a bridge of cooperation between enterprises and the government, the logistics association fully promotes logistics management and improves resource allocation. However, because China’s logistics association is still in its initial stage, it is difficult for it to effectively unite the government and enterprises to solve the market monopoly, the incomplete system, and other problems. An evolutionary game model among the government, associations, and enterprises is constructed in order to develop a sustainable governance mechanism for the logistics industry to realize cooperative supervision and healthy competition among relevant participants. Based on the bounded rationality and expected payoff of the participants, the main determinants of the optimal strategy are analyzed, and the evolution path and equilibrium state of the three game groups are studied by numerical simulation. The results show that strengthening the independence of the association, increasing the government’s reward to the association, and highlighting the positive social effects of industry independence are important factors for the healthy development of the logistics industry. In addition, the association must play its role in submission, distribution, and communication with the government and enterprises, constantly strengthen its own construction, improve industry standards, and create a favorable market environment for logistics enterprises.

Balancing wind power deployment and sustainability objectives in Swedish planning and permitting

BackgroundWind power is a critical renewable energy technology in efforts to achieve the global climate targets. However, local impacts do occur, which demands careful consideration in planning and permitting. Sweden has set an ambition to triple land-based wind power by 2040, and municipalities play a key role in both the planning and permitting process, due to a planning monopoly and veto power in the permitting process. This calls for an investigation of Swedish wind power governance, with a particular focus on recent trends in municipal wind power planning, how wind power is balanced in relation to sustainability objectives in planning and permitting, and insights from practitioners regarding their capacities and drivers.ResultsThe results show that about two-thirds of Swedish municipalities have conducted wind power planning in some form, but this basis for decision-making has become outdated due to a lack of institutional capacity at the municipal level. Secondly, the study finds that many municipalities perceive that there are insufficient incentives for a continued wind power expansion. Lastly, the study sheds light on a large heterogeneity within wind power planning practice concerning how trade-offs between wind power deployment and other sustainability aspects are handled, as well as a lack of coherence between planning and permitting.ConclusionsIt is concluded that the current state of municipal wind power planning raises questions regarding the legitimacy of municipal decision-making in terms of perceived justice among local inhabitants and highlights the need for updated wind power plans. Moreover, to promote local acceptance in the future, formalised financial compensation and strategic initiatives that enable the localisation of electricity-intensive industry within municipalities with large-scale wind power production can be two key components. The results also highlight the need for additional support at the municipal level, including access to critical competence and relevant knowledge to enable trade-offs between the different sustainability considerations in an informed and balanced manner. Finally, regional dialogue with key actors, such as the military, Sami representatives and grid operators, would facilitate the handling of inter-municipal issues, in particular by fostering co-operation regarding inter-municipal wind sites.

What role does private sector development play in Nigeria’s economic growth?

Many studies have concluded that private sector development encourages economic growth due to many public enterprises’ poor performance and technological deficiencies. However, other studies have noted that private sector development would lead to the misuse of monopoly power. Since the advocacy is from two different perspectives, there is a need to investigate further the impact of private sector development on the country’s economy. The bounds cointegration test examined the long-term relationship between privatization and GDP growth. The long- and short-term connections between private sector development and GDP growth were studied using an Auto-Regressive Distributed Lag (ARDL) model. As a result, economic growth was found to be highly influenced by gross capital formation and market capitalization of domestic listed enterprises as a share of GDP, according to the ARDL estimates in the short term. In addition, the periods after privatization increase growth by about 0.23% in the short run and by 3.87% in the long run, at a 1% significance level. At a 1% significance level, gross capital formation and market capitalization of domestic listed enterprises as a share of GDP positively affected economic growth in the long term. This led to the conclusion that private sector development positively influences Nigerian economic growth in both the long- and short-term. This study recommends policy changes such as raising domestic investment and promoting privatization, capital market development, and financial institution development. This will stimulate private sector development and have a favorable impact on economic growth. AcknowledgmentsWe appreciate the feedback from our unnamed reviewers, the Journal’s editor, and the authors whose works were referenced. In addition, we acknowledge the support of our colleagues from the Economics Department, Afe Babalola University Ado-Ekiti, for their helpful feedback to improve this study.

Fair Market Constitutionalism: From Neo-liberal to Democratic Liberal Economic Governance

Abstract Neo-liberalism was in crisis well before COVID-19; and COVID-19 has only further highlighted the gaps and fault lines in existing liberal democratic models. But this does not mean that we should walk away from liberal ideals, or the general idea of globalisation or market-based forms of ordering. Instead, we should seek a new, more ‘democratic’ or pro-social understanding of the liberal ideal, which emphasises the idea of fair rather over free markets. This idea of fair markets can be understood in numerous ways, but I suggest that it is best understood as entailing a commitment by the state to: (i) guaranteeing access to a public baseline of core goods, or access to a generous social minimum to all citizens, regardless of market outcomes; (ii) ensuring equality of access to certain ‘relative goods’; (iii) regulating market power or sources of monopoly power; and (iv) responding to or ‘internalising’ negative externalities or social costs associated with private market behaviour. The article explores what this entails for the design of constitutions, and especially constitutional property and social rights, and the scope and strength of judicial review. Ultimately, the article suggests, fair market constitutionalism points to the desirability of a combination of weak property and social rights—ie property rights that offer some but not complete protection for existing economic entitlements, coupled with legislative duties to implement fair market norms or limited weak social rights guarantees. But this does not mean that such guarantees can only be weakly enforced by courts: blockages in the democratic process may mean that courts can and should adopt a weak–strong—or responsive—approach to enforcing these fundamentally weak rights guarantees.

The expansionary strategies of intellectual monopolies: Google and the digitalization of healthcare

As big tech companies are entering new industrial sectors, an open question concerns the drivers of their expansionary strategies. This paper proposes that these companies are currently entering sectors based on their data-driven intellectual monopoly power, thereby complementing the preliminary answer provided by political economy research which has argued that expansion is driven by their infrastructural power. This approach is developed through a historical analysis of tech giants as companies that systematically turn knowledge and data into intangible assets, showing their expansionary strategies in the healthcare sector to be mainly driven by insights obtained from those intangible assets (a monopolized intangibles driver) and by a quest for conquering new knowledge and data to perpetuate their intellectual monopolies (an intangibles prospecting driver). The paper further illustrates its arguments through a case study of Google’s expansionary strategy and its prioritized incursion into healthcare.

Oligopoly in grain production and consumption: an empirical study on soybean international trade in China

What has been neglected in much of the existing studies of the influence of seasonal and regional characteristics of agriculture on the market power and national security. This paper constructs a multivariate equations model to investigate the monopoly power of seasonal suppliers and national security in China’s soybean market. The results show no relationship between market share and monopoly power; and that CR3 and HHI show China’s soybean import market has been the highest oligopoly type, but the model suggest that exporters (the U.S., Brazil and Argentina) have very weak monopoly power and China has no monopsony power; and that the performance of some exporters’ soybeans is affected by others, while others are relatively independent in market. This is due to the non-substitutability of the product, the non-substitutability of the buyer and the seller, etc., which causes the mutual dependence of the seller and buyer, and their market power cancel each other out. The seasonality and regionality of soybean production is the root. Considering national security, it is necessary to take the seasonal and regional characteristics of exporters into account to disperse trade risks and oppose monopolisation of international food production and trade.

Pluralism and Democracy in Yugoslavia

The present debate in Yugoslavia about "democratization" of the League of Communists is a consequence of the Party's heritage of anti-Stalinism, the constitutional evolution of the country, and the situation after Tito's death. Nearly two decades ago the Praxis group of political philosophers were the first to criticize the absence of intraparty democracy, and while many of these critics were silenced, their ideas have re-emerged in Yugoslavia during the economic crisis of the 1980's. Within the League, the debate has touched on its responsibility for public policy, its organizational principles, and its monopoly of power. Opposition to reform and fear of political change have limited practical effect of the debate, but it continues to raise fundamental questions ahout the meaning of democracy in a one party system.

Artificial intelligence adoption in a monopoly market

AbstractThe adoption of artificial intelligence (AI) prediction of demand by a monopolist firm is examined. It is shown that, in the absence of AI prediction, firms face complex trade‐offs in setting price and quantity ahead of demand that impact on the returns of AI adoption. Different industrial environments with differing flexibility of prices and/or quantity ex post also impact on AI returns as does the time horizon of AI prediction. While AI has positive benefits for firms in terms of profitability, its impact on average price and quantity, as well as consumer welfare, is more nuanced and critically dependent on environmental characteristics.

노동시장 수요독점력 측정

This study measures the markdown, an indicator of monopsony power, in the labor market from 2000 to 2019 using Korean firm data, and examines the relationship with the labor share. Under the cost minimization, the expressions for markdown and mark-up were derived, and markdown was identified by distinguishing it from markup. Results show that the markdown was 2.71 on average in the 2000s and 3.56 in the 2010s. Firm's monopsony power in the labor market is very large. Labor markdown has a strong correlation with corporate sales. In the 2010s, the monopsony powers in labor market by small or medium firms were on the decline, while the monopoly powers by large firms remained high. According to the estimation results, monopoly and monopsony power negatively affect the labor share.