Many services provide outputs that depend partially on the customers as inputs; the presence of other customers often contributes to the output experienced by each purchaser. Higher education is the premier example; others are legion. We provide a simple model that addresses the questions of competitive pricing and allocative efficiency for these types of services. Prices that charge customers for what they get on net (output minus input) from the firm both are competitive and support efficient allocations; these prices internalize the apparent external effects of customers on each other. Few examples of such prices exist in the real world.

Journal Article Appropriate Technology, X-Inefficiency, and a Competitive Environment: Some Evidence from Pakistan Get access Lawrence J. White Lawrence J. White New York University Search for other works by this author on: Oxford Academic Google Scholar The Quarterly Journal of Economics, Volume 90, Issue 4, November 1976, Pages 575–589, https://doi.org/10.2307/1885322 Published: 01 November 1976

Journal Article A Note on the Influence of Monopoly on Product Innovation Get access Lawrence J. White Lawrence J. White Princeton University Search for other works by this author on: Oxford Academic Google Scholar The Quarterly Journal of Economics, Volume 86, Issue 2, May 1972, Pages 342–345, https://doi.org/10.2307/1880571 Published: 01 May 1972

SMALL businesses are prevalent in some sectors of the economy and relatively scarce in others. If we use two frequently employed definitions of small business-firms with annual sales at or below $500,000 or $5 million'-we can see the relative patterns in table 1: Agriculture, construction, wholesale and retail trade, and services are areas in which small businesses are relatively important; mining and manufacturing are areas in which they are less important. Why does small business flourish in some sectors and not in others? This question has been tackled in a qualitative fashion by a number of authors.2 But, to this author's knowledge, there have been no quantitative efforts to establish the determinants of small business prevalence. The closest approximations in the economics literature are, in effect, the inverse: the efforts to explain concentration in individual industries (e.g., efforts to explain the sizes of the four-firm or eight-firm concentration ratios across industries).3 Some of these concentration data have also been analyzed in the context of discussions about small business.4 But the concentration data provide only indirect evidence for the small business question. This paper will provide some direct cross-section evidence on the determinants of the relative importance of small business. Our sample will be limited to the manufacturing sector, largely for reasons of data availability, but the results should have general economy-wide applicability. Section II will discuss the major hypotheses to be tested. Section III will describe the data. Section IV will describe the results of the tests. And section V will provide some brief conclusions.

The automotive emissions program is far from perfect. It is too inflexible and too costly; it is long on command-and-control and short on incentives. But, as this paper indicates, the program is achieving substantial reductions in pollutant emissions. The real question, then, is not whether the program is achieving emissions reductions but whether the benefits of those reductions are worth the costs and how the program might be redesigned so as to achieve those benefits at lower costs. 4 references.