1970 Articles

Oligopoly Theory, Entry-prevention, and Growth

Bhagwati, Jagdish N.

The focus of the theory of oligopoly has been shifted towards entry-prevention models since the recent work of Sylos Labini and Bain, especially after its brilliant formalization by Franco Modigliani. This paper examines the entry-prevention approach critically, while relating it to the traditional approaches to the analysis of oligopoly behaviour. The analysis is also extended to incorporate the phenomenon of "growth of firms."