Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/56118 
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dc.contributor.authorFriberg, Richarden
dc.contributor.authorMartensen, Kajen
dc.date.accessioned2012-03-28T13:03:50Z-
dc.date.available2012-03-28T13:03:50Z-
dc.date.issued2000-
dc.identifier.urihttp://hdl.handle.net/10419/56118-
dc.description.abstractAverage profits of a price taker are increasing in the variability of the output price (Oi, 1961). We show that, for the same reason, average profits of the price taker are increasing in the variability of the price of inputs. We proceed to establish that the same holds for a firm with a downward sloping demand curve. Unless the inverse demand curve of the firm with market power is very convex, the profit function of the price taker forms an upper limit for the convexity of profit (assuming constant curvature of costs).en
dc.language.isoengen
dc.publisher|aStockholm School of Economics, The Economic Research Institute (EFI) |cStockholmen
dc.relation.ispartofseries|aSSE/EFI Working Paper Series in Economics and Finance |x402en
dc.subject.jelD80en
dc.subject.ddc330en
dc.subject.keywordcost uncertaintyen
dc.subject.keywordconvexity of profit functionen
dc.subject.stwMark-up Pricingen
dc.subject.stwPreistheorieen
dc.subject.stwTheorieen
dc.titleVariability and avrage profits: Does Oi's result generalize?-
dc.typeWorking Paperen
dc.identifier.ppn333188772en
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen

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