P/E/111. Microsoft and Government Intervention

The paper explains the reasoning behind the following statement: "The theory of supply suggests that as a rough and ready rule, the public writerities should keep their eye on the number of producers in an industry. When this becomes too small public intervention will be necessary"; and analyses whether the statement applies to Microsoft. Also paper discusses whether the statistics pioneered by Bain provides convincing support for the "rough and ready" rule. Moreover, during the U.S Justice Department's case against Microsoft, it was argued by the defence that Microsoft was not a dominant firm but in a "contestable market". The paper explains this model briefly and discusses whether it fits the Microsoft case