The cost of monopoly on Australian manufacturing

In this article we present new estimates of the degree of welfare loss resulting from monopoly elements in Australian manufacturing. The measure suggested by Cowling and Mueller is modified to take into account the presence of oligopolistic firms, which are imperfectly collusive. One conclusion of our article is that the social costs of monopoly in Australia are likely to be substantially higher than previous estimates have suggested. We also look at the characteristics of the industries which have high ratios of welfare loss by industry. There appears to be a (weak) relation between the size of the welfare loss and the degree of concentration in the industry