Personal Income Distribution and Market Structure

Posted: 19 Dec 2002

See all articles by Corrado Benassi

Corrado Benassi

University of Bologna

Roberto Cellini

University of Catania - Department of Economics and Business

Alessandra Chirco

Universita di Lecce - Facolta di Economia

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Abstract

Income distribution affects market demand and its elasticity, and, as a consequence, the optimal behaviour of firms and market equilibrium. This paper focuses on the effects of income polarization, and presents a model where - for any unimodal density function describing income distribution of the consumers - income polarization leads to market concentration, i.e., to a smaller number of firms able to survive in the long run, provided that the firms' fixed costs are sufficiently low.

Suggested Citation

Benassi, Corrado and Cellini, Roberto and Chirco, Alessandra, Personal Income Distribution and Market Structure. Available at SSRN: https://ssrn.com/abstract=320579

Corrado Benassi (Contact Author)

University of Bologna ( email )

Department of Economics
Piazza Scaravilli 2
40126 Bologna
Italy

Roberto Cellini

University of Catania - Department of Economics and Business ( email )

Corso Italia 55
95129 Catania, 95129
Italy
+390957537728 (Phone)
+390957537710 (Fax)

Alessandra Chirco

Universita di Lecce - Facolta di Economia ( email )

Ecotekne
Via per Monteroni
73100 Lecce
Italy

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