Re: Microeconomics of cornering

["Devine, James" <jdevine@xxxxxxx>]

this seems related to the model often used in industrial organization of the dominant firm facing a competitive fringe. The firm takes the supply curve (quantity supplied at each price) of the competitive fringe for granted and then acts as if it were a monopoly.
Jim

	-----Original Message----- 
	From: Michael Pollak [mailto:mpollak@xxxxxxxxx] 
	Sent: Fri 8/1/2003 10:08 PM 
	To: PEN-L@xxxxxxxxxxxxxxxx 
	Cc: 
	Subject: Re: [PEN-L] Microeconomics of cornering
	
	

	On Fri, 1 Aug 2003, Eugene Coyle wrote:
	
	> Are you thinking of "cornering" per se or simply gaming markets?
	
	I guess neither "cornering" nor "gaming" nor "fixing" exactly describes
	what I'm interested in.  I'm interested specifically in raising the price
	of a commodity by restricting how much you supply in cases where you (and
	your friends) don't have a monopoly, but where tightness of the market can
	give you a temporary leverage similar to that exercised by a monopolist.
	But one you lose as the market gets slack again.
	
	This seems to me the power of Opec.  And if it is, I've yet to see it
	modelled clearly.  I've only seen it described as a monopoly, as if market
	demand didn't matter, or as a chimera, helpless in the face of the market.
	
	Michael