Question

Compare and contrast the four different treatments of monopoly presented (Neoclassical, Mises, Kirzner, and Rothbard). •

What is wrong with using perfect competition as a benchmark? •

Is it appropriate to consider barriers to entry that are due to consumer preferences? •

Answer 1

A monopolist in neoclassical analysis is a tiom that faces the entire demand for the pouduct under consideration. In order to maximize its profit it produce an ocuplet where the marginal serenue associated with the last unit sold is just equal to the marginal costs asociated with the producing and selling that tinal unit: monopoly exists for ludwing von mise when the whole sepply of commodity is control by a single seller or group of sellers acting in concertt miser holdy that monopoly pricei do not resuet unied the restrictions in supply poudures prices that actually increase the monopolist total proceeds! Kirzer vieus temanket process as one in which market sellers are continually attempting to inch ahead of rival by offering more attractive opportunities to potential buyers. kizner is one whose' exclusive inputs blocks competitive enty into the production of wis products noter monopoly is the single supplier of some product in the market. Rothbard analysts of monopoly monopoly price and te weefer implications of such economic condition. one to single sellor of any give good; a graut of special privileg by the state ires senring reatain area of productice to one particolar individual or group; and three a Pessor who has achiered monopoly price. net . kizner - CS

volumes gives these firms the power to exclude ση) per unit because of large Meoclassical economist claim that perfect competition a theastical market structure woeld poduce the best possible economic outcomes for both consumers and society. All deal market exist outside of the perfect competition model because it is an abstract, theoretical model. puse competition can only describe what things would be like if the world cataired zombie-lice consumers with homogeneous teste, atomistical structured firms identical in every important respect, with to locational advantage The two most importet barriers to enty are product dibromtiation and seale economies, product diffrentiation limits competition since it makes competitive entry more costly, scale economies alla limit competition. The fact that certain firms realize lower Cost smaller firms ar smaller potential entrants from the market. Thies to take the barrier to entry theory seriously is to end up proposing as rational public theory policy in the name of consumer welfare the very procedures that consumers would likely find most hambul. Barriers to enry often came or aid the existence of monopolies or give companies marcet power. allo profeet incumben firms and sestrict competition in a market. CS Scanned with CamScanner