Economic and Social Sustainability: The Influence of Oligopolies on Inequality and Growth
1
School of Accounting and Finance, Faculty of Business and Economics, University of the South Pacific, Suva, Fiji
2
Department of Global Business and Economics, Changwon National University, Changwon 51140, Korea
*
Author to whom correspondence should be addressed.
Sustainability 2020, 12(22), 9378; https://doi.org/10.3390/su12229378
Received: 19 October 2020 / Revised: 5 November 2020 / Accepted: 9 November 2020 / Published: 11 November 2020
(This article belongs to the Section Economic and Business Aspects of Sustainability)
To realize economic and social sustainability, it is necessary to avoid economic injustice and therefore too unequal a distribution of income and wealth. In this paper we investigate the extent to which oligopolies contribute to an unequal income distribution, and the consequences of enforcing more market competition. For this purpose, an overlapping generation growth model is developed with imperfect competition to derive the influence of market concentration on economic growth and the distribution of income. We investigate the influence of market concentration on the inter- and intra-generational distribution of income and economic growth. We show that political lobbying and corruption are important reasons for missing competition in markets. While an increasing market concentration leads to a more unequal intra-generational distribution and to a redistribution of income from the old to the young generation, the impact on economic growth is in general ambiguous, and specifically depends on the cost of lobbying.
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Keywords:
economic and social sustainability; oligopoly; economic growth; inequality; lobbying; bribing; political economy
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MDPI and ACS Style
Kumar, R.R.; Stauvermann, P.J. Economic and Social Sustainability: The Influence of Oligopolies on Inequality and Growth. Sustainability 2020, 12, 9378. https://doi.org/10.3390/su12229378
AMA Style
Kumar RR, Stauvermann PJ. Economic and Social Sustainability: The Influence of Oligopolies on Inequality and Growth. Sustainability. 2020; 12(22):9378. https://doi.org/10.3390/su12229378
Chicago/Turabian StyleKumar, Ronald R., and Peter J. Stauvermann 2020. "Economic and Social Sustainability: The Influence of Oligopolies on Inequality and Growth" Sustainability 12, no. 22: 9378. https://doi.org/10.3390/su12229378
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