InternationJoaul rnaol f IndustriaOl rganizatio6n ( 19884) rth-Holland MONOPOLY AND THE PREEMPTION OF COMPETITIVE RECYCLING* AbrahamH OLLANDER andP ierreL ASSERRE Universitde MontrealM, ontrdalQ, ubbecC, anadaH 3C 3J7 Finalv ersiorne ceiveJda nuary1 988 Thep apme srah rokwesth ata monopolistpicri marpyr oduceorf a recycleabmlea teriawl illc hoosteo preemptetn tryb y competitivrec yclerusn lestsh ec osto f producinvgir ginin gotis very highc omparetdo thec osto f reconditioniunsge dm likee arliere sultsit, is shown thatin thea bsencoef transactiocons tso ns craps alecs ompetitiobnyi ndependerenct yclerfas ils mtoe rreed ucep riceb elowit s full-monopolelyv elM. oreoveirf, transactiocno stsa re presentth, e threaotf entryb y independerenct yclemrs ayr aiseth ep ricea bovteh all evel. 1. Introduction Entry preemptionth rought he purchaseo f inputse ssentiatl o entrants \[Lewis( 1984)\]m akesm ores ensew hens uchi nputsa re availablein limited quantitieosn ly. This conditionis metw hent he entrantas re recyclingfi rms which dependo n scrap suppliesf or their ndeed,i n such marketst,h e quantityo f primaryo utput( .,a luminiumin gotso r products), which is a choice variableo f the dominantfi rm (the primaryp roducer), directly determinesth e amounto f materiala vailablef or recyclingb y independentTsh. us,t he outputd ecisionso f the dominanfti rm determinteh e costt hati t will havet o incurl atert o prevenet ntrantfsr om gaininga ccesst o recycleablme aterialA. notherc haracteristoicf thosem arketsis the low value of recycleablme aterialw, hich impliest hat transactiocno sts take"upm ore importancien the supplyo f scrapt hani n the supplyo f conventionainl puts. If transactiocno stsa re too high, final productu sersd iscardu sedp roducts rathert hant ryingt o sell thema s scrap,w hichi mpliest hatt he originals eller losess omec ontrolo ver the marketf or recyclingm aterialI,n this paper,w e investigatteh e problemo f the primaryp roducera s he internalizetsh e effect of his quantityd ecisiono n consumercsh' oicesi,n cludingth e decisiont o sell or discardu sedp roductsa, ndo n preemptiocno st. While the recyclingp roblemh as beens tudiedin thel iteraturet,h is hasn ot *We thanktw o anonymoruesf ereefos r theirc ommenotsn an earlievr ersionof thep aper. NormanIr elanda lsos uggestesedv eracl arifications. 0167-7187/88/$3©.5 109 88E, lsevieSr ciencPeu .( North-Holland)
490 A, Hollandera nd P. Lasserre,M onopolya nd preemptioonf competitivree cycling beend one in the contexto f entryp reemptionE. mphasish as been on the following question:h ow does the presenceo f independenrte cyclersi n additiont o a primaryp roducera ffectp rice?U sing a very revealingm odel wheret he primaryp roducersa nd recyclersa re separatefi rms, Swan (1980) has shownt hatt he existenceo f a fringeo f competitivree cyclersa ffectsp rice and profits of the dominantf irm in a way which critically dependso n whethert he proportiono f materialr eclaimedfr om scrapi s technicallyfi xed or variable,a nd on whethero r not recyelersb uy scrap directlyf rom the originalo wnerso f wornoutp roducts. The questionw hethetrh ep rimaryp roducebr enefitsfr ome nteringth es crap recyclings ector is addressedb y Martin (1983). Assumingt hat a fixed proportiono f scrapi s discardedb y consumersh,e finds that in the absence of barrierst o entry into recycling,t he primaryf irm never profits from integratinign to secondarpyr oduction. As its names uggests,c rapi s a limitingc aseo f an economicg ood:a slight drop in the price of the recycledp roductm ay turn a lot of scrap into garbageA. lso, becauses crapc ommandsu ch a low price,t ransactionco sts are preponderanint consumersc'h oicesw hethert o sell or discards or the dominantf irm, the cost of early preemptionw ill be the expenseo f acquirings crap;b oth the price and the quantityo f scrapw ill dependo n the quantityt hati t producesS. wanf oundt hatt he outcomed ependso n whether consumersse ll the scrap,o r simplyd iscardi t for the scavengertso t turnso ut thatt his is only truep rovidedp reemptioins non-profitable. Our modeli s presentedin section3 . Section4 discussest he conditions wherep rofit maximizationd ictatese ntry preemptionT. he consequenceosf preemptioanr ef urthera nalyzedin section5 . We find thatt he meret hreato f entryc an lead to a higherp ricef or the refinedp roduct( virginm etal)t hani n the absenceo f potentiacl is paradoxicarle sultm ayo ccure ven thoughe ntry does not actuallyt ake place,i .e. even in the absenceo f the inefficientr ecyclingd iscussedb y Swan. The threato f entry by competitive recyclersm ay raiset he price becauseit leadst o an increasein the price the dominanfti rm mustp ayf or the scrapw hichi t withdrawsfr om the marketi n ordert o keept he entrantso ut. Although our model is primarily designedt o investigatem arketsf or recycleablme aterialsi,t readilya ppearsth at the intuitionc arrieso ver to the caseo f durableg oodsw herem aintenancaen d repairsm ayb e carriedo ut by a competitivferi nge. 2. The model A quantityo f virgin metalv is producedb y a singlef irm at the constant unit costA he productsc ontainingth e metalw earo ut aftert he lapseo f a fixed period of time, which for reasonso f convenienceis, chosent o be
A. Hollandear ndP . LasserreM, onopolya ndp reemptionfc ompetitivrec ycling 491 ® (~ c~4. Cl' 1 } /cl. 3 B ACv AOv - I o 7~ 8~ ~2 i 1 x 0:3,,~: 3's 84 0:85 1 X 0 =8 2':~3=3 '3 Fig. 1. Alternativre cyclinign tensitieasn dc ostc onfigurations. negligibleJW ornoutp roductsa re scrappeda nd subsequentlrye cycledin to a quantitys of secondarym etalw hich is a perfects ubstitutefo r primary he metalp ricei s denotedp ; its quantityis denotedq and equalsv + s. The costo f obtainingm etalf rom scrapd ependso n the recyclingin tensity, x, which is defineda s the amounto f metale xtractedp er unit of ach unit of scrap containsb oth high and low quality componentsT. he high quality componentsy ield metal at a lower cost than the low quality us, with everyr ecyclingin tensityi,t is possiblet o associatea quality which is the lowest qualityb eing recycledw hen scrap is recondi- tioneda t thati ntensityT. he totala nd averagec ostso f recyclinga singleu nit of scrapa t the intensityx are denotedC r(x) and AC,(x) respectivelyw, ith A C,(x)= -C r(x)/x~. Scrapc an be recyclede itherb y the firm which producesv irginm etalo r by a fringeo f independenret cyclersT, he recyclingte chnologiys availableto all, and therei s freedomo f entry into everthelessth, e intensitya t which recyclingt akes place, dependso n who does the he independentwsh o regardt he metalp rice p as a given,r eclaims crapu p to the point 8, where either the marginalr ecyclingc ost equals p, or, the recyclingin tensitya ttainsi ts technicaml aximum0 . The primaryp roducer, on the other hand, choosesa recyclingi ntensity7 which equalizest he marginacl osto f primarya nd secondarmy etal. Possibleo utcomesa re illustratedin fig. 1 for alternativceo nfigurationosf marginarl ecyclingc ostsC '(x). When marginacl osti s C'r~ a s in panell a, the monopolisct hooses7 1 while recyclersp refer~ . With marginacl oste qualt o 1As Swan( 1980e) xplainisn mored etail,t hisi s formallye quivalentot the steadsyt ate situatiown hicha risews henp roduclti fei s constanatn dd emanids time-stationary. 2It is worthe mphasizitnhga tf or a givenr ecyclinign tensityth, ea veragceo stis independeonf t thea mounotf metapl roducedso, thatm arginaclo stis equatlo averagceo oweverif, we considecrh angeins x rathetrh ano utputw, eh aveC ;>AC,.
492 A. Hollandear nd P. LasserreM, onopolya ndp reemptioonf competitivrec ycling C',2 , the primaryp roducecr hoosesY 2 and the independengtso all the way to th technicaml aximumO . The latteri s also optimalf or the primaryp roducer whenC ',3 is the marginacl anel lb depictss ituationsw herer ecyclingis profitablefo r independentsi,n ceC ',4 and C'rs are lower thanp ricef or some rangeo f x, but not for the primaryp roducera, s C~4 and C',5 are everywhere abovet hea verageco stA Cv of producingv irginm etal. Freedomo f entryi nto recyclingd rivest he scrapp rice ~bt o a level where thep rofitso f independenret cyclervs anish,i. e. 6\[p-ACr(6)-\~] b=0. (1) ~bi s also the price that the primaryp roducerp ays for scrap?T he product users,f or whom ~bi s a given,d ecidew hethert o sell or simplyt hrow away their n fact, scrapm ust be vieweda s a productw hosep rice ~b is specifiedi n termso f its well definedr ecycleablme aterialc ontentb, ut which is highly heterogeneouass far as the discardedp roductsi t is made of: aluminumc ans, tin foil, car componentsf,a ctoryt rimmings,e tc. Product usersm ayd ecidet o sell the cansb ecauseth erei s an organizedre cuperation systemf or them and transactionc osts are relativelyl ow, but they will typicallyd iscardt in foil with the rest of their garbageb ecauseth eyd o not have accesst o any well organizedm arketf or such n order to captureth is ideat hat,d ependinogn theirc haracteristicsso, mep roductsm ay, while othersm ay not, be worth selling as scrap,w e assumet hat product ownersi ncur a transactionc ost Ct(z) on the proportionz of their scrap which they decidet o sell; becauseo f the heterogeneounsa tureo f wornout productsC, t(z)i s assumedto be risinga t an increasingra tea s z increasesz, is chosens o as to maximizep roductu sers'r evenuefsr om scraps ales,n et of transactionc osts (z=argmax( $y-Ct(y)).U nsold scrap is not worthless, however;it is just worthlesst o the producto wner becauseo f transaction iscardedp roductsd o not incur any such costs;t heya re collecteda t zero cost* by scavengersw ho sell them for n their buying 3Them aximump riceh e would be preparedto pay is the increasein profitsh e obtainsb y withdrawinag unit of inputt hatw ouldo therwisge o to thec ompetitivree cyclersT. he minimum pricew hichi s requiredto inducec onsumertso sell to him rathert hant o recycleriss thep rice recyclersa re preparedto offer. In view of the fact that the primaryp roducerc ould always recyclea t thes amein tensitya s thei ndependentits ,m ustb e thec aset hatt hem aximumpr iceh e is willing to payi s not smallert hant hep riceo fferedb y thei ndependentOsu. r assumptiotnh at he purchaseast thep ricer ecyclersa reo fferingis equivalentto endowingh im with monopsony poweri n thes crapm arket. 4A scavengeisr efficientb ecauseh e doesn ot makea ny transactiown ith producto wnersh; e picksu p refusesq uicklyr athert hani dentifyingth em,w eighingth ema, ndc ollectingm oneyf rom eacho wner. Since recyclingc ostsp er se are coverede lsewherein the model,a nd we have assumetdh ats ortingis parto f recycling,t herei s no losso f generalitiyn assuminzge roc ostf or scavengersT. his zero-costa ssumptionim plies that scavengerms ay make positivep rofits, althougha rent-seekinagr gumencto uld be invokedt o arguet hat thosep rofitss omehowg et wasted.
A, Hollandera nd P, LasserreM, onopolya nd preemptioonf competitivree cycling 493 decisions,p roductu sers take accounto f the future scrap value of their a result,t he marketp riceo f metali s the sum of its userv alue p(q) (p' <0) and its net scrapv alue( scraps alesr evenuefsr omt hosep roducts thata re not discardedz~ bm inust ransactiocno stsC t(z): p = p + zck - C,(z). (2) 3. Profit maximizationb y the primaryp roducer The problemo f the primaryp roduceris how muchm etalt o producea nd whethert o allow entry by the independenrte cyclersH. e can prevents uch entryb y buyingt he scrap,w hich is a necessariyn put for iven his dominantp osition,h is profitsw ill be identicalt o industryp rofitsd efinedt o include,b esidesh is own, recyclersp' rofitsw hich are maximizeda t zero,a nd producto wners'p rofits on scrap sales, also null at their maximumw ith respectt o Let ~\[0,1 \] denotet he fraction of availables crap being purchasedb y the primaryp roducerT. his is recycleda t intensity7 while the resti s recycleda t intensity6 , Industryp rofit (identicalt o the profit of the dominantf irm) is then revenuem inusc ost of virgin productionm inus cost of integratedre cycling minusc osto f independenret cyclingm inuss crapp urchases. rc- -pq-- vACv- avqAC ,(~,)- (1 - a)6qAC ,(6) - dpq, (3) where v=(1-aT-(1-a)6)q and qS=C;(z),6 =argmaxx(px-Cr(X),O);w hen 0<6<0,p =C',(6),~ --argmaxx(ACvx-C,(x),O);w hen 0<?<0,A Cv=C',(~). Simplem anipulationysi eld rc= q \[p- - o~AC ,(7)- - (1 -- a)A C,(6) - d,b3 , whereA Ct(k), k= {~6, }, is the averagein dustryc ostw henr ecyclingis carried out at the intensityk ; formally,A Ci(k)=(1- k)ACv+ kAC,(k). Substitutin(g2 ) = q\ [p- - (1 -- z)~ b- C, - (1 - a)A C,(6)- aAC ,(7)\]. (4) It is clear from (4) that any reductionin the proportiono f scrapw hich is discardedi,n transactionco sts,o r in industryp roductionc osts,w ill increase the dominanfti rm'sp hosec ostc omponentasr ej ointly determinebdy preemptivpeu rchaseasn d outputd ecisions. 5profitsb y scavengerosn discardeds crap are not includedi n this definitiono f industry profits. J,,-- E
494 A. Hollandearn dP . LasserreM, onopolayn dp reemptionf c ompetitirveec ycling 4. Preemptiveb uyinga nd recycling From( 4) we obtain0 ~z/c3c(~A=C i(fi)-ACg(y))>q 0 so thatw e can state Proposition1 . When the primary producer buys up all available scrap, industryc ost is eitheru nchangeodr completep reemptiodno esn ot reducea veragein dustryc ost, thent he primaryp roduceris indifferenbt etween buyinga nd not buyings f completep reemptiodno esr educein dustryc ost, thent his will be adopted(~ = 1). In ordert o see why this is so, recall that the primaryp roducerp ays the samep ricef or scrapa s the independenwtso uldp hereforeit is profitable for him to entert he scrapm arketw henh e can replacet he metalt heyw ould drawf roms crapb y virginm etalp roducedin a less costlyf e is able to do thatb y replacingb, y virgin ingot,t he marginaul nitsw hich secondary metalr ecyclerws ouldh avep roduced. Proposition1 statest hat if y<0, preemptiown ill be completeT. his result which may appear counterfactuaol nly emergesb ecausew e have, for notationasl implicity,a ssumedt hat scrapi s unsortedw hen it is purchased. When sorteds crapi s available,t he primaryp roducerb uys, but does not recyclet he low qualitym aterialsw hoser ecyclingc ostsa re highert han the costo f virgin e is indifferenbt etweenp urchasingo r not purchasing scrap whose recyclingc ost is lower than ACv. The fact that complete preemptionis rare is consistenwt ith the hypothesisth at recyclingo f high quality scrap is, in general,a less costly way of producingm etal than primaryr efining. 5. The determinatioonf output Treatingn ow a as a given,q uantityis determinebdy d~ ~n ~7td 6 ~3ndz O=~q=q ~q+ ~-~~ qqqO- z dq' (5) Since recyclersa nd productu sers'p rofits are maximizedw ith respect o and z respectivelya, nd those variablesd o not otherwisec ontributet o industry profits, the last two terms in (5) are zero at the optimum6. Consequentltyh, e optimalq is determinebdy On/Oq= 0,i .e., MR = ~ACI(7)+ (1 - ~)AC i(6) + C, + (1 - z)(q4;- ¢), (6) whereM R=p+p'qa nd q~i s treateda s a functiono f q definedb y (1) and (2). 60~/d=6 - q\[p--(l-a)AC~(6)-C',(t6h)i\s]i; s zerow hen3 < 0 by thed efinitioonf 6 in (3) and propositio(n1 );w hen6 =0,O n~Omf ayn ot be null,b ut then3 6/3q=0S. imilarlyd, n/dz= -C't(z)w hichv anisheast thev alueo f z selectebdy p roducuts ers.
A, Hollandera nd P, LasserreM, onopolya nd preemptioonf competitivre cycling 495 The relevanmt arginacl osta s seeni n (6) includes( lastt erm)t he fractiono f expenditureosn scrapp urchasews hichc annotb e passedo n to consumers. 6. Competitiver ecyclinga nd the price of metal So far, we have identifiedt he factorsa ffectingt he equilibriuma nd have describedh ow they e now comparet hat equilibriumw ith the equilibriumt hatw ouldp revaili f the primaryp roducewr as the sole ownero f the recyclingt echnologyW. e refer to the latter as the full monopoly equilibriuma nd to such a monopolisticp rimaryp roducera s a full-fledged monopolistF. irst, notet hatw hene ntryi nto recyclingis impossiblea, ll scrap is discardedb y consumersb ecauset he primaryp roducern eed not offer a positive price for scrap which has no alternativeb uyer. Consequently, productp rice will equal user price. The optimalq uantitys et by the full- fledgedm onopolyw ill be determinebdy MR = A Cl(7). (7) Our comparisonw ith the free entrye quilibriumw ill first be madef or the case where 7<6 and then for the case where 7=6=0. As we shall see contraryt o immediatein tuition,t he threato f entry by recyclersis more likely to reducep rice when recyclingi s more costly comparedt o virgin production, When 7<6,b y Proposition1 , the conditionsfo r completep reemptionar e mets o that,s etting~ = 1 in (4), we obtain = rp - a c,(7)3 q - \[-(1 - z) 4, + C,(z)\]q . (8) The first componenot f (8) is profits of the full-fledgedm onopolista nd the secondc omponenits the loss incurredo n the fractiono f expenditureosn scrap which cannotb e passedo n in the metal price. When at the profit maximizingp oint of the full-fledgedm onopolistt, he losseso n scrap pur- chasesi ncurredb y the preemptoar re positive( negativea) t the margin,h e will set a quantitylo wer( higher)t han the full-fledgedm onopolistN. ote that when Ct=0 and thus z=l, the maximando f (8) is the same as for the full-fledgedm deedn ot havingt o pay for scrapi s equivalento beinga ble to passo n the entires crapp rice. Thus, in contrast o Swan, we find that in the absenceo f significant ransactionco sts,p ricew ill not be set belowt he full monopolyle vel. For C,>0, outputw ill be higher( lower) and price lower (higher)t han underf ull monopolyif , at the full monopolyle vel of output,t he effect of changingq on the secondt erm in (8) is negative( positive).T his effect is (substitutin(g1 ) and (2))
496 A. Hollandear ndP . LasserreM, onopolya nd preemptioonf competitivre cycling c~\[(-1 z)0+ C,(z)\]/O=q \[6(1- z)/(1- 6z)\(]M R - A C,(6)) + \[(l- 6(1 - z))/(1- 6z)\C] ,(z). (9) At the profit maximizingp oint of the full-fledgedm onopolistM, R=ACi(?). Whent ransactiocno stso n scrapa re prohibitiven, onei s incurredb ecausea ll scrapi s throwna way;t he secondt ermo n the right-hands ide of (9) vanishes and z=0. Consequentlyth, e quantityw ill be smallera nd the price higher underp reemptiown henA Ci(7)>A Ct(c3)a nd vice he casew hereC t is positiveb ut not prohibitivein creasetsh e rangeo f configurationwsh erep rice with preemptionis highert han the full monopolyp rice,b ecauseth e second termo n ther ight-handsi deo f (9) is positive. When 7=6=0 so that, by Proposition1 , the preemptionle vel does not affectp rofit,w e obtainf rom( 4) rc= \[p- - A C~0( )\q] - \[(1 - z)q 5+ Ct\q] , (lo) Clearly,a s in (8),t he full monopolyp ricei s obtainedw hent ransactiocno sts are zero. When transactionc osts are positive, then z<l. Given that (1-z)c~+Ct>0w,e obtaint hat the metalp rice is higherw hen independent recyclersa re free to entert han it would be underf ull inally, when transactionco stsa re prohibitivew, e have z=0, Ct=O, and p=p so that the profit function becomesn =(1-0) (p-ACv)q7. We therefore concludet hat the equilibriump rice is the same,a s would prevail if the recyclingte chnologdyi d not t clearlye xceedist s full monopolyle vel. 7. Summarya nd final remarks We have shown that except for recyclingc onfigurationsw here the marginalr ecyclingc ost is alwaysb elow the cost of producingv irgin ingot, the primaryp roducerf inds it profitablet o preempte urprisinglyw, e find that the threato f entrym ay raise the metalp rice abovet he level that would have prevailedi n the absenceo f such a n fact, Swan had foundt hata ctuale ntryb y independenrte cyclersc ould raisep ricea bovet he full monopolyp rice,a nd attributedth is to the fact thatt he independenfitr ms recyclem orei ntensivelyth ani s efficient,s incep ricee xceedsth e costo f virgin ingot. We find that entryp reemptionm ay raise the price even if no such inefficient recyclingt akes place. Inefficiencyo ccurs when a costly scrap marketi s substitutedfo r the systemo f recuperationw ithout transactions whichp revailsu ndert he full-fledgedm onopoly. Allowinge ntryp reemptioinn creasetsh e primaryp roducer'st rategysp ace; 7From( 1) we obtain( a=Op-OAC,(O)s;u bstitutinign to (10), with z=C,=0,n =p-AC~(O)- Op+ O AC,(O)S. ubstitutintgh ed efinitiono f AC,{O)y ieldst her esult.
A. Hollandera nd P. Lasserre,M onopolya nd preemptioonf competitivre cycling 497 we obtain strongerr esults than previousa e find that, in the absenceo f transactionc osts, the competitivep ressurep ut on a primary monopolisbt y the existenceo f a recyclingte chnologya ccessiblteo all, never reducest he price below the full-monopolyp rice level,i .e. below the price levelt hatw ouldp revaili n the absenceo f a threato f entry. When transactionc osts are non-negligiblet,h e picturei s less clear-cut becauseth e expenseo f repurchasinsgc rapc annotb e addede ntirelyt o the user price, The fractionw hich cannotb e addedi s borne by the primary producera s a cost. As a result, the effectivec ost of repurchasingsc rap increasews hen recyclingb ecomesle ss his accountsfo r the fact that the threato f entryi mposesa heavierb urdeno n the primaryp roducerw hen recyclingc ost is very low. Consequentlyw, e get the apparentlpy aradoxical resultt hat a threato f entryb y low-costr ecyclersr aisest he price,w hereas sucha threatb y high-cosrte cyclerms ayl oweri t. While our modeli s specializedto capturem arketr elationshipisn indus- triesw herer ecyclingta kesp lace,i t suggestas n explanatiofno r the phenome- non of trade-insw hich is oftene ncountereidn durableg oodm arketsW. hen durablesa re priceda bovep roductionc ost,t heir durabilityw ill be extended by maintenancaen d repairsf or a longert ime than is ur model suggestst hat a monopolists upplyings uch a durableg ood will find it profitablet o buy back his productsw hich have reacheda certaina he criterionw e haved evelopedfo r determininwg hethert he primaryp roducer buyss craps uggesttsh ati n the durableg oodc ase,t rade-insw ill be observed wheng oodsh aver eachedth e agea t which thee xpectede xtensiono f life time obtainedfr om a dollars pento n maintenancweo uld be insufficientto induce consumersto carry out such maintenanchea d the durablesb eens old at a competitivep t a more general evel,o ur paperi llustrateso nce more the need to consideri nput marketsw hen investigatintgh e price effectso f policiesd esignedto affectm arketp oweri n an outputm arket. References FriedmanM, ., 1967P, ricet heory(A ldineN, ew York). GaskinsD, .W.,1 974A, lcoar evisitedTh: ew elfariem plicationosfa second-hamnda rketJo, urnal of EconomiTch eory7 , 254-271. Lewis,T ., 1983P, reemptiodniv estituraen, df orwardc ontractining a markedto minatebdy a singlefi rm,A mericaEnc onomiRc eview7 3,n o. 5, 1092-1101. Martin,R .E. 1982,M onopolyp owera nd the recyclingo f raw materialsT,h e Journalo f IndustriaEl conomicXsX X, no. 4, 405--419. Salop,S . nd . Scheffman1,9 83R, aisingr ivalsc ostsT, he AmericaEnc onomiRc eview, Papersa ndP roceeding7s3 , no. 2, 267-271. Swan,P ., 1980A, lcoa:T he influencoef recyclinogn monopolyp owerJ,o urnalo f Political Economy8 8,n o. 1, 76-99.
