Coase conjecture
The Coase Conjecture describes the price-setting behavior of a monopoly that manufactures durable goods.
Ronald Coase suspected that in the borderline case - with an infinite lifespan - such a monopoly behaves like a company with complete competition . Many consumers will postpone their purchases because they expect a lower price later. These alternatives limit the monopolist's freedom to set prices.
literature
- Ronald Coase, Durability and Monopoly , in: Journal of Law and Economics, vol. 15 (1), pp. 143-49, 1972.
- Werner Güth (1994), Market and Price Theory , Springer-Verlag, Chapter 3.3
- Jean Tirole (1988), The Theory of Industrial Organization , MIT Press, Chapter 1.5.2