ABSTRACT
Structure and Multiproduct Industries”, Journal of Economic Literature, 20/3 (September 1982): 1024-48
Baumol, William J. and Dietrich Fischer, “Cost-minimizing Number of Firms and Determination of Industry Structure”, Quarterly Journal of Economics, 92/3 (August 1978): 439-67
Baumol, William J., “Contestable Markets: An Uprising in the Theory of Industry Structure”, American Economic Review, 72/1 (March 1982): 1-15
Baumol, William J., John C. Panzar and Robert D. Willig, Contestable Markets and the Theory of Industry Structure, revised edition, San Diego: Harcourt Brace, 1988
Grossman, Sanford J., “Nash Equilibrium and the Industrial Organization of Markets with Large Fixed Costs”, Econometrica, 49/5 (September 1981): 1149-72
Raa, Thijs ten, “Resolution of Conjectures on the Sustainability of Natural Monopoly”, Rand Journal of Economics, 15/1 (Spring 1984): 135-41
Reed, Randall L. and Don E. Waldman, “Mergers and Air Fares: ‘Contestable Markets’ in the Airline Industry”, Antitrust Law and Economics Review, 20/3 (1988): 15-20
Schwartz, Marius and Robert J. Reynolds, “Contestable Markets: An Uprising in the Theory of Industry Structure: Comment”, American Economic Review, 73/3 (June 1983): 488-90
Stefanidis, Christodoulos, “Selective Contracts, Foreclosure, and the Chicago School View”, Journal of Law and Economics, 41/2 (1998): 429-50
Willig, Robert D., “Contestable Market Theory and Regulatory Reform” (chapter 3, including a commentary by Lee L. Selwyn) in Telecommunications Deregulation: Market Power and Cost Allocation Issues, edited by John R. Allison and Dennis L. Thomas, New York: Quorum, 1990
The theory of contestable markets first appeared in the 1980s with the work of BAUMOL and of BAUMOL, PANZAR & WILLIG, with other important contributions by Elizabeth Bailey (BAILEY & FRIEDLAENDER), Dietrich Fischer (BAUMOL & FISCHER) and RAA. It has since been applied by regulations in a number of countries. For example, the theory explicitly underlies government rules on the freight rates charged by railroads in the US, and on the access charges levied by any one telephone company for use of its facilities by a rival telephone company in New Zealand.
