Premium
The Strategic Industry Supply Curve *
Author(s) -
Menezes Flavio M.,
Quiggin John
Publication year - 2020
Publication title -
the journal of industrial economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.93
H-Index - 77
eISSN - 1467-6451
pISSN - 0022-1821
DOI - 10.1111/joie.12229
Subject(s) - monopoly , oligopoly , economics , supply and demand , nash equilibrium , demand curve , competition (biology) , representation (politics) , mathematical economics , microeconomics , partial equilibrium , industrial organization , cournot competition , general equilibrium theory , ecology , politics , political science , law , biology
In this paper, we develop the concept of the strategic industry supply curve, representing the locus of Nash equilibrium outputs and prices arising from additive shocks to demand. We show that the standard analysis of partial equilibrium under perfect competition, including the graphical representation of supply and demand, due to Marshall, can be extended to encompass imperfectly competitive markets. Our approach permits a unified treatment of monopoly, oligopoly and competition in linear supply schedules. Further, our model satisfies the five principles of incidence set out by Weyl and Fabinger [2013].