A monopolistically competitive agricultural market structure has some features of competition and some features of monopoly. Monopolistic competition has the following attributes: (a) many sellers; (b) product differentiation; and (c) free entry. In the long-run equilibrium, price equals average total cost, and the agricultural firm earns zero economic profit. The aim of this paper is to construct a relatively simple chaotic long-run monopolistic competitor’s agricultural output growth model that is capable of generating stable equilibria, cycles or chaos. A key hypothesis of this work is based on the idea that the coefficient plays a crucial role in explaining local stability of the monopolistic competitor’s agricultural output, where d is the coefficient of the marginal cost function of the agricultural monopolistic competitor; b is the coefficient of the inverse demand function; a is the coefficient of average cost growth; m is the Pigovian tax rate; and e is the coefficient of the price elasticity of demand.
Economic Diversification Potential: Insights from Mongolia’s Livestock Product Value Chains
Mongolia, endowed with abundant natural resources, faces a critical challenge in reducing its reliance on the mining sector and achieving...
