Regulated Prices, Rent Seeking, and Consumer Surplus.
Price controls lead to misallocation of goods and encourage rent seeking. The misallocation effect alone ensures that a price control always reduces consumer surplus in an otherwise-competitive market with convex demand if supply is more elastic than demand or with log-convex demand (e.g., constant...
| Publicado en: | Journal of Political Economy Vol. 120; no. 1; pp. 160 - 187 |
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| Autores principales: | , |
| Formato: | Artículo |
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University of Chicago Press
Feb2012
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| Acceso en línea: | Ver este registro en EBSCOhost |
| fields | @attributes: recordID: 1 pdfLink: plink: https://search.ebscohost.com/login.aspx?direct=true&db=ssf&AN=74388861&site=ehost-live header: @attributes: shortDbName: ssf uiTerm: 74388861 longDbName: Social Sciences Full Text (H.W. Wilson) uiTag: AN controlInfo: bkinfo: jinfo: jid: 00223808 JPE jtl: Journal of Political Economy issn: 00223808 maglogo: N pubinfo: dt: Feb2012 vid: 120 iid: 1 pid: 415 pub: University of Chicago Press artinfo: ui: 74388861 10.1086/665416 ppf: 160 ppct: 27 formats: tig: atl: Regulated Prices, Rent Seeking, and Consumer Surplus. aug: au: Bulow, Jeremy Klemperer, Paul affil: Stanford University Oxford University su: Elasticity (Economics) Price regulation Mathematical models of pricing Consumers' surplus Demand function Mathematical models of supply & demand Rationing Rent seeking sug: subj: Elasticity (Economics) Regulation, Licensing, and Inspection of Miscellaneous Commercial Sectors Price regulation Mathematical models of pricing Consumers' surplus Demand function Mathematical models of supply & demand Rationing Rent seeking ab: Price controls lead to misallocation of goods and encourage rent seeking. The misallocation effect alone ensures that a price control always reduces consumer surplus in an otherwise-competitive market with convex demand if supply is more elastic than demand or with log-convex demand (e.g., constant elasticity) even if supply is inelastic. The same results apply whether rationed goods are allocated by costless lottery or whether costly rent seeking and/or partial decontrol mitigates the inefficiency. Our analysis exploits the observation that in any market, consumer surplus equals the area between the demand curve and the industry marginal revenue curve. pubtype: Academic Journal doctype: Article src: R language: English refInfo: copyright: @attributes: flag: N holdings: @attributes: islocal: N |
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