In this paper, a general model of the competitive firm's behavior under output and factor (total) price uncertainty is developed to evaluate the role of market interdependencies in analyzing long-run equilibrium conditions and comparative statics analysis of increased uncertainty in output and input prices. It is demonstrated that the results shown in the literature are a special case of the findings reported here and market interdependencies play a central role in determining the firm's long-run equilibrium under uncertainty.
Citation: Pilot Scholars Version (Modified MLA Style)
Adrangi, Bahram and Raffiee, Kambiz, "On Total Price Uncertainty and the Behavior of a Competitive Firm" (1999). Business Faculty Publications and Presentations. Paper 9.