Research Paper No. 651

THE DISTRIBUTIONAL EFFECTS OF MONOPOLY IN NEW ZEALAND

by

John Creedy & Robert Dixon

August 1998

Department of Economics. University of Melbourne. Parkville Victoria 3052 Australia

ABSTRACT

CONTENTS
 
 

1 Introduction
 
 

2 Monopoly and Prices

2.1 Profit Maximisation and Identical Marginal Costs

2.2 Profit Maximisation and Different Marginal Costs

2.3 Computing Price Changes
 
 

3 Calculating Welfare Changes

3.1 The Linear Expenditure System

3.2 Consumers' Surplus Measures
 
 

4 Empirical Results
 
 

5 Conclusions
 
 

A Estimation of the LES Using HES Data
 
 

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