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Socially efficient entry barriers?
Общественно-эффективные барьеры входа?
[journal article]
Abstract Stagnation of the Russian economy lends a new urgency to the question of whether reserves of competition incentives can be used to overcome the current negative economic tendencies. The lowering of entry barriers is traditionally considered a universal instrument of promoting competition. However, l... view more
Stagnation of the Russian economy lends a new urgency to the question of whether reserves of competition incentives can be used to overcome the current negative economic tendencies. The lowering of entry barriers is traditionally considered a universal instrument of promoting competition. However, lower entry barriers can be mistakenly associated with bringing the market closer to the state of the so-called "perfect" competition. The authors aim to show that the absence of entry barriers does not improve competition in certain markets. On the contrary, it may result in a decrease in social welfare. This is particularly true of capital-intensive goods, for instance, large diameter pipes for gas pipelines. Lack of proper competition in such sectors of the market necessitates entry barriers, for they help to achieve a separating equilibrium at the market. Since there are costs associated with creating a separating equilibrium, it is necessary to assess both costs and benefits of the pooling and separating equilibria.... view less
Keywords
economy; Russia; stagnation; competition; industrial policy; market
Classification
National Economy
Sociology of Work, Industrial Sociology, Industrial Relations
Free Keywords
Eintrittsbarriere; Gleichgewichtstrennung; Pooling
Document language
English
Publication Year
2016
Page/Pages
p. 26-38
Journal
Baltic Region (2016) 3
DOI
https://doi.org/10.5922/2079-8555-2016-4-3
ISSN
2079-8555
Status
Published Version; peer reviewed