Duality of welfare and profit maximization
Many economists are aware that the conditions for the efficiency and monopolization in a partial equilibrium framework are the extremes of the Ramsey-Boiteux formula when the Lagrange multiplier for the budget varies. We formalize the duality existing between the welfarist and monopolist constrained...
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| Format: | article |
| Status: | Versión aceptada para publicación |
| Publication Date: | 2011 |
| Country: | España |
| Institution: | Varias* (Consorci de Biblioteques Universitáries de Catalunya, Centre de Serveis Científics i Acadèmics de Catalunya) |
| Repository: | Recercat. Dipósit de la Recerca de Catalunya |
| OAI Identifier: | oai:recercat.cat:10256/24753 |
| Online Access: | http://hdl.handle.net/10256/24753 |
| Access Level: | Open access |
| Keyword: | Monopolis Monopolies Duopolis Beneficis Profit |
| Summary: | Many economists are aware that the conditions for the efficiency and monopolization in a partial equilibrium framework are the extremes of the Ramsey-Boiteux formula when the Lagrange multiplier for the budget varies. We formalize the duality existing between the welfarist and monopolist constrained maximization programs by proving the following 'folk theorem': max Welfare s.t. profit ≥ fixed cost ⇔ max Profit s.t. output ≥ minimum |
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