Distributive and Regional Effects of Monopoly Power

Abstract

This paper estimates the distributive and regional effects of firms with market power in the case of Mexico. It presents evidence that the welfare losses due to the exercise of monopoly power are not only significant, but also larger, in relative terms, for the poor. Moreover, the losses are different for the urban and rural sectors, as well as for each of the states of Mexico, being the inhabitants of the poorest ones the most affected by firms with market power.