Evaluation of Market Power in Manufacturing Industries in Iran

Document Type : Research Paper

Author

University of Sistan and Baluchestan

Abstract

This paper using generalized Roeger's model calculated the Lerner index for Iranian active industries in 4-digit ISIC codes during the period 1995-2007. The findings indicate that the Lerner index has been between 8 to 16 percent in 38 industries among 131 ones. The index also in different industries shows that more than 50 percent of Iranian industries have monopolistic power such that they have generated a significant gap between price and marginal cost. Comparing the Lerner index with Herfindahl–Hirschman and four - firm concentration ratio indices gives this result that the industries with high concentration ratio have greater value of Lerner index so that The four-firm concentration ratio of 20 industries (among the 29 industries) has had a value more than 40.
JEL Classification: F1 ،L1،L6

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History

  • Receive Date: 15 October 2011
  • Revise Date: 17 September 2013
  • Accept Date: 23 April 2013

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