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Aggregation with Cournot Competition: An Empirical Investigation
Bertrand Koebel and François Laisney
Annals of Economics and Statistics
No. 121/122 (June 2016), pp. 91-119
Stable URL: http://www.jstor.org/stable/10.15609/annaeconstat2009.121-122.91
Page Count: 29
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This paper empirically investigates the existence of Cournot equilibrium and the validity of the Le Chatelier-Samuelson (LCS) principle in the aggregate. Whereas two well known existence conditions are statistically rejected, we cannot reject a third, original, condition. We also find some empirical evidence for the LCS principle, as well as both increasing and constant returns to scale for two-digit US manufacturing industries. The results highlight the importance of imperfect competition for understanding aggregate growth, investment and employment. JEL: D21, D43. / KEY WORDS: Aggregation, Le Chatelier-Samuelson Principle, Returns to Scale, Market Power, Markup, Own-Price Elasticity.
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