ABSTRACT
Most studies of the welfare effects of buffer stock stabilization schemes have assumed competitive behaviour by consumers and producers: Waugh (1944), Oi (1961), Massell (1969), Samuelson (1972), Hueth and Schmitz (1972), Turnovsky (1976), and Newbery and Stiglitz (1979). However, production is cartelised in many of the markets for which buffer stocks have been mooted. This paper considers the welfare effects of storage when production is controlled by a cartel which behaves as a monopolist.
