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This is a long comment that is too long for the comment box. In fact, many research projects in US are secretive, especially the ones related to military. At the same time, much, much more research projects in China are secretive, including some agricultural ones, which are not military-related but considered as national security-related by Chinese ...


4

Provided that increasing returns to scale apply over the whole production function of the company it is likely that it would become natural monopoly. For example, Mankiw in Principles of Economics (pp 292) in some passages even defines monopolies in relation to their cost function: When a firm’s average-total-cost curve continually declines, the firm has ...


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Besides the great answers already given, adding my two cents: A firm ends up being a sole player in the sector when market entry for others is restricted, which may not be guaranteed by IRTS or even continual economies of scale. First, it is important to realize that, contrary to our first naive intuition, IRTS does not imply economies if scale. See this for ...


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It can be shown that a firm with increasing returns to scale (IRTS) and no market power makes a negative profit (and may not be observed at all, in the long run). Conclusion: either subsidies, or market power is necessary for a firm with global IRTS to be sustainable. With usual notations, the claim follows from the first order condition for an (inner) ...


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fall in price arising from the labor savings The price of a product is usually determined in part by its cost. (This holds in almost all theoretical models without strict capacity constraints, even in the extreme case of monopoly.) If automation can replace some of the labor with cheaper machines, cost will decrease, hence the product will be sold at a ...


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There is not necessarily any contradiction. Full employment does not mean every single person in economy is employed. Full employment is (Worswick; 1987): Full employment does not mean zero unemployment. There can be dislocations where large numbers of workers are displaced from their present employment, and time is needed before new workplaces can be ...


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I might be wrong but the key point is the perspective. From your question I saw a very interesting word: enemy. I understand that some entity would be against telling the enemy about his knowledge and is mostly true: US didn't gift the blueprints of the nuke bomb to the URSS. But, that is because there is top confidential information that may not be good to ...


1

As "High GPA" has rightly pointed out, most of the military and national defence research tends to be confidential. Added to that, any specific area where having some specific knowledge can result in monetary benefits follows a similar pattern. This is best exemplified by the existence of patents. Additionally, there are monetary and social ...


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