e-space
Manchester Metropolitan University's Research Repository

    Monopoly as a ‘culture-history fact’: Knight, Menger, and the role of institutions

    Salerno, Joseph T, Dorobat, Carmen Elena and McCaffrey, Matthew C (2021) Monopoly as a ‘culture-history fact’: Knight, Menger, and the role of institutions. Journal of Institutional Economics, 17 (6). pp. 1049-1064. ISSN 1744-1374

    [img]
    Preview
    Published Version
    Available under License Creative Commons Attribution.

    Download (243kB) | Preview

    Abstract

    Frank Knight's theory of monopoly price has received relatively little attention in the literature on Risk, Uncertainty and Profit. We argue that Knight accepted and refined the monopoly price theory of Carl Menger and his followers. Knight highlights the difference between monopoly as an inevitable outcome of departures from perfect competition, and monopoly as a contingent or ‘culture-history fact’. In the latter case, coercive institutional barriers to potential competition shape the choice set of consumers and producers, and provide a crucial method for identifying monopoly gains. There are three benefits to this account of Knight's contributions: it rehabilitates the focus on the institutional determinants of monopoly price, as opposed to the mainstream emphasis on market frictions and imperfections; it opens the way for a Mengerian monopoly price theory that seriously engages the study of institutions; and it adds new evidence and nuance to ongoing debates about Knight's place in economics.

    Impact and Reach

    Statistics

    Activity Overview
    6 month trend
    157Downloads
    6 month trend
    78Hits

    Additional statistics for this dataset are available via IRStats2.

    Altmetric

    Repository staff only

    Edit record Edit record