Skip Navigation


Oxford Economic Papers Advance Access originally published online on October 16, 2007
Oxford Economic Papers 2008 60(2):369-382; doi:10.1093/oep/gpm037
This Article
Right arrow Full Text
Right arrow Full Text (PDF)
Right arrow All Versions of this Article:
60/2/369    most recent
gpm037v1
Right arrow Alert me when this article is cited
Right arrow Alert me if a correction is posted
Services
Right arrow Email this article to a friend
Right arrow Similar articles in this journal
Right arrow Similar articles in ISI Web of Science
Right arrow Alert me to new issues of the journal
Right arrow Add to My Personal Archive
Right arrow Download to citation manager
Right arrowRequest Permissions
Google Scholar
Right arrow Articles by Caputo, M. R.
Right arrow Articles by Partovi, M. H.
Social Bookmarking
Add to CiteULike   Add to Connotea   Add to Del.icio.us  
What's this?

© Oxford University Press 2007 All rights reserved

Intrinsic comparative statics of a general class of profit-maximizing rate-of-return regulated firms

Michael R. Caputo* and M. Hossein Partovi{dagger}

*Department of Economics, University of Central Florida, Orlando, FL 32816–1400, USA; e-mail: mcaputo{at}bus.ucf.edu (corresponding author)
{dagger}Department of Physics and Astronomy, California State University, Sacramento CA 95819–6041, USA; e-mail: hpartovi{at}csus.edu

JEL classifications: C60, D21, L51


  Abstract

An exhaustive comparative statics analysis of a general rate-of-return regulated, profit-maximizing model of the firm is carried out under a minimal set of assumptions. The resulting intrinsic comparative statics are contained in a positive semi-definite matrix. Each element of this matrix consists of a product of the A-J effect term and a Slutsky-like expression, thereby permitting the familiar interpretation of a compensated price change. The minimal set of assumptions allows a range of anomalous behavior that includes, inter alia, a reversal of the sign of the A-J effect and an increase in the use of an unregulated factor as a result of a compensated own-price increase. The implications of additional assumptions for the mathematical structure of the model and its economic consequences are discussed, and the equivalency relations among those assumptions are delineated. Throughout, mathematical results of the analysis are interpreted with a view to elucidating their intuitive economic significance.


Add to CiteULike CiteULike   Add to Connotea Connotea   Add to Del.icio.us Del.icio.us    What's this?




Disclaimer:
Please note that abstracts for content published before 1996 were created through digital scanning and may therefore not exactly replicate the text of the original print issues. All efforts have been made to ensure accuracy, but the Publisher will not be held responsible for any remaining inaccuracies. If you require any further clarification, please contact our Customer Services Department.