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Existence and uniqueness of marginal cost pricing equilibrium

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Abstract

This paper considers a regulated monopoly that is subject to a marginal cost pricing policy. A marginal cost pricing equilibrium is a price-subsidy combination for which price equals marginal production cost and any losses are offset by the lump-sum subsidy. Employing basic degree theoretic results, conditions are established under which a marginal cost pricing equilibrium exists and is unique.

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Authors and Affiliations

  1. Oklahoma State University, USA

    Kevin M. Currier

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  1. Kevin M. Currier
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Currier, K.M. Existence and uniqueness of marginal cost pricing equilibrium. Atlantic Economic Journal 25, 312–317 (1997). https://doi.org/10.1007/BF02298413

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  • DOI: https://doi.org/10.1007/BF02298413

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