Séminaires LEMMA

Mardi 15 octobre 2019 - 11 heures - Salle Maurice Desplas

 "Poverty, Competition, Democracy and Ownership: a General Equilibrium Model with Vertical Preferences"

Rim LAHMANDI-AYED - Université de Carthage

Abstract: We consider a general equilibrium model where individuals are simultaneously workers, consumers and shareholders, with two possible market structures: Monopoly and Duopoly, and two  extreme ownership

structures: egalitarian and concentrated. Considering four standard poverty indicators, the questions are, whether more competition generates more or less poverty for a given ownership structure; and whether a democratic choice between Monopoly and Duopoly leads to the alternative with less poverty. When the ownership is concentrated, we show that, according to three among the four indicators, Duopoly generates less poverty than Monopoly and the majority votes for the alternative with less  poverty. When the ownership is egalitarian, Duopoly may generate more or less poverty and democratic choice alleviates poverty regarding at least one poverty indicator and worsens poverty regarding at least another one, the four poverty indicators never converging. An empirical study on the effect of competition on poverty supports to some extent our theoretical findings.