The model set forth in the preceding chapter pertains to an oligopolistic industry in which the price leader is a member of that one industry alone. As such, it can be used to analyze pricing behavior in a significant portion of the oligopolistic sector. Still, if it is not to be unduly limited in its applicability, the model needs to be modified to encompass other types of industries and other types of firms. This is the task of the present chapter.

The most important of those other types of firms is the conglomerate megacorp – a megacorp that is a member of more than one industry. Such firms are becoming increasingly more common. Indeed, it has been suggested that they represent a higher stage in the evolution of the corporation in the United States. Insofar as one of these conglomerate megacorps is a price leader in one or more industries, its behavior may not be entirely explainable in terms of the model set forth above. At the same time, many firms that might otherwise meet the criteria for being classified as a megacorp are members of regulated industries. Such firms, too, are important – if only because they dominate certain critical sectors of the economy. The question is whether the oligopolistic pricing model set forth above can be applied to these regulated enterprises as well.