INTRODUCTION In 1995, in a small city in northeastern Argentina, a local magnate who owned some gas stations, a transportation company, and several other businesses supported a fellow Radical Party member in the contest for mayor. But once in office the magnate’s protégé proved too independent. In the next mayoral race, in 1999, the magnate threw his support behind a competitor. Despite the may...

We consider the asymptotic behavior of the following model: balls are sequentially thrown into bins so that the probability that a bin with n balls obtains the next ball is proportional to f(n) for some function f . A commonly studied case where there are two bins and f(n) = np for p > 1. In this case, one of the two bins eventually obtains a monopoly, in the sense that it obtains all balls thr...

We show modern information technology (in short IT) is the cause of rising income and wealth inequality since the 1970's and has contributed to slow growth of wages and decline in the natural rate. Hence, the source of most improvements in our living standards also causes social losses and rising inequality. We first study all US firms whose securities trade on public exchanges. Surplus wealth ...

Einer Elhauge is almost singlehandedly winning a battle against the Single Monopoly Theory. The theory, as popularized by early Chicago School theorists,1 argues that a “vertically integrated monopolist can earn monopoly profit only in one of the markets—either the upstream or downstream market, but not both [and that] firms typically cannot extend monopoly power over one product to other produ...

Under what circumstances should a competition authority allow a merger that creates a monopoly? As competition policy is predicated on the need to protect consumers from market power, the presumption might be that such a merger should never be allowed. However, there are circumstances in which a merger to monopoly can be the best available option. The European Commission’s recent clearance (sub...

In this paper, we develop a model of experience goods pricing with indepedent private valuations. We show that the optimal paths of sales and prices take qualitatively different shapes for different products. If the buyers are initially pessimistic, then the prices are declining over time. If the buyers are initially optimistic, then the optimal prices are initially low followed by higher price...