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On the Production Efficiency of a Location-Regulated Firm

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  • Hong Hwang
  • Chao-Cheng Mai

Abstract

This paper evaluates the effect of location regulation on a monopolist's output and examines the desirability of such regulation. It is shown that a location regulation can increase the output if the production functions do not exhibit constant returns to scale and that the output level could be higher than the social welfare maximum (without intervention) if demand curves are sufficiently convex to the origin.

Suggested Citation

  • Hong Hwang & Chao-Cheng Mai, 1990. "On the Production Efficiency of a Location-Regulated Firm," Canadian Journal of Economics, Canadian Economics Association, vol. 23(4), pages 908-922, November.
    • Handle: RePEc:cje:issued:v:23:y:1990:i:4:p:908-22
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    Cited by:

    1. Hong Hwang & Chao‐cheng Mai, 1999. "Optimal Export Taxes with an Endogenous Location," Southern Economic Journal, John Wiley & Sons, vol. 65(4), pages 940-952, April.

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