The B.E. Journal of Theoretical Economics
Editor-in-Chief: Schipper, Burkhard
Ed. by Fong, Yuk-fai / Peeters, Ronald / Puzzello , Daniela / Rivas, Javier / Wenzelburger, Jan
IMPACT FACTOR 2017: 0.220
5-year IMPACT FACTOR: 0.328
CiteScore 2017: 0.28
SCImago Journal Rank (SJR) 2017: 0.181
Source Normalized Impact per Paper (SNIP) 2017: 0.459
Mathematical Citation Quotient (MCQ) 2017: 0.09
We consider a monopoly producing a good whose demand grows over time. Whatever the price policy which is adopted, the monopolist invests in order to meet the resulting demand growth. She can only invest in indivisible factory units. We identify the optimal price policy, and the ensuing optimal sequence of investment time points the monopoly selects through time. We show that this sequence satisfies the constant cycle property observed under capacity expansion for an exogenous increase in demand (Manne, 1961).
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