Indeterminate Output Allocations in Collusive Equilibria and Multi-plant Firms
نویسنده
چکیده
If n colluding oligopolists all have the cost function C(qi) = c qi, then it will not be possible to uniquely allocate among the firms the monopoly output that maximizes their joint profit. Similarly, if all plants of an n-plant firm have the cost function C(qi) = c qi, then it will not be possible to uniquely allocate the firm’s optimal output among the n plants. This paper identifies the necessary and sufficient condition for such “allocative indeterminacies” to occur. DRAFT: Not for quotation Comments welcome
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