Consumers Rejoice: Oligopoly Price Regulation Boosts Welfare!
The article explores how to regulate prices in markets where a few big companies control the supply. They focus on a market where all companies sell the same thing, have similar costs, and can only set prices based on how much they produce. The researchers figure out the best way for a regulator to set prices to make sure both consumers and companies benefit the most. They find that the optimal policy depends on how much people want the product and how much it costs to make.