Article
The Economics of Profit-Cap Policy: Big Pharma, Big Tech, and the Duopoly Rule
2023-02-03
Abstract excerpt
A known policy dilemma occurs between the need to curb extra-large profits by some industries, like pharmaceuticals, and the need to ensure the incentive to produce is not damaged. This paper shows that a profit cap, imposed via taxation on a group of firms, can simultaneously eliminate inefficiency and excess profit by intensifying competition among oligopolistic firms. The result has a direct bearing on policy d...
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Identifiers and source
- Literature Corpus work
- 1bff7b28-e4ef-5254-8bfd-365dc484f09b
- DOI
- 10.2139/ssrn.4228280