ࡱ> +-*#` M bjbj .Mbbbbbbbv~~~~  v $Mh J<b<bbQbbbb 0~g0   b<<vvvvvvvvvbbbbbb WHEN CAN REGULATION DEFER TO COMPETITION FOR CONSTRAINING MARKET POWER?: COMPLEMENTS AND CRITICAL ELASTICITIES Dennis L. Weisman* When can regulation defer to competition for imposing price discipline? We show that high pricecost margins, reflecting scale/scope economies, in combination with demand complementarities serve to constrain the market power of the (de)regulated firm. Because price increases that produce even small reductions in demand can generate significant losses in contribution to joint/common costs, relatively modest amounts of competition may be sufficient for deregulation. To assist policymakers in their deliberations, a comparison of firm-specific price elasticities and critical price elasticities can be used to determine whether the (de)regulated firm would have incentives to raise prices post-deregulation. pA B   G H 8 I J K M hbf96] hbf9H*hbf90JH* hbf90Jhbf9pL M gdbf9gdbf9gdbf9M ,1h/ =!"#$% @`@ bf9NormalCJ_HaJmH sH tH N`"N bf9 Heading 2dd@&[$\$5CJ$\aJ$DA@D Default Paragraph FontRi@R  Table Normal4 l4a (k@(No ListB^`B bf9 Normal (Web)dd[$\$*W`* bf9Strong5\MpLO000h0pLO0000LM M M RFN1OOLOLOhbf9@LLh\LLMP@UnknownGz Times New Roman5Symbol3& z Arial"1hifif~~!4LLHX?bf92LibguestLibguestOh+'0`   (4@HPX Libguest Normal.dot Libguest2Microsoft Office Word@@/@/~՜.+,0 hp  Kansas State UniversityL  Title  !#$%&'(),Root Entry FpV0.Data  1TableWordDocument.SummaryInformation(DocumentSummaryInformation8"CompObjq  FMicrosoft Office Word Document MSWordDocWord.Document.89q