Jablanovic, Vesna D.
Agricultural monopolistic competitor and the Pigovian tax
Studies in Agricultural Economics
Studies in Agricultural Economics
Studies in Agricultural Economics
Studies in Agricultural Economics
4
Volume 115
Number 1
monopolistic competition
agriculture
long-run
equilibrium conditions
the Pigovian tax rate
chaos
Agribusiness
Agricultural and Food Policy
Agricultural Finance
Demand and Price Analysis
Production Economics
2013
2013-02
A monopolistically competitive agricultural market structure has some features of competition and some features of monopoly. Monopolistic competition has the following attributes: (a) many sellers; (b) product differentiation; and (c) free entry. In the long-run equilibrium, price equals average total cost, and the agricultural firm earns zero economic profit. The aim of this paper is to construct a relatively simple chaotic long-run monopolistic competitorâ€™s agricultural output growth model that is capable of generating stable equilibria, cycles or chaos. A key hypothesis of this work is based on the idea that the coefficient plays a crucial role in explaining local stability of the monopolistic competitorâ€™s agricultural output, where d is the coefficient of the marginal cost function of the agricultural monopolistic competitor; b is the coefficient of the inverse demand function; [] is the coefficient of average cost growth; m is the Pigovian tax rate; and e is the coefficient of the price elasticity of demand.
Studies in Agricultural Economics
http://dx.doi.org/10.7896/j.1224
Journal Article
1418 2106