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The Investment Effects of Price Caps under Imperfect Competition. A Note.

Buehler, Stefan and Burger, Anton and Ferstl, Robert (2008) The Investment Effects of Price Caps under Imperfect Competition. A Note. Working Papers / Research Institute for Regulatory Economics, 2008,3. Forschungsinstitut für Regulierungsökonomie, WU Vienna University of Economics and Business, Vienna.

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Abstract

This note analyzes a simple Cournot model where firms choose outputs and capacities facing varying demand and price-cap regulation. We find that binding price caps set above long-run marginal cost increase (rather than decrease) aggregate capacity investment. (author's abstract)

Item Type: Paper
Keywords: capacity / investment / Cournot competition / price cap
Classification Codes: JEL D24, D43, L13, L51; RVK QR 300
Divisions: Forschungsinstitute > Regulierungsökonomie
Depositing User: Repository Administrator
Date Deposited: 29 Mar 2010 09:42
Last Modified: 10 Aug 2011 15:11
URI: http://epub.wu.ac.at/id/eprint/1766

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