Monopolistic Competition And Search Unemployment
AbstractIn this paper the monopolistic competition model of Dixit and Stiglitz for the goods market and the search unemployment model of Pissarides are combined. The Pissarides part loses its Walrasian goods market and the Dixit-Stiglitz part loses its Walrasian labour market. Pissarides' results now depend on the degree of competition. In the Dixit-Stiglitz part the size and number of firms as well as aggregate output now depend on aggregate hiring costs, tightness and unemployment, while real wages are not fixed. Some partial results of comparative static properties of the original models survive. New results concerning the effects of changes in labour (goods) market parameters on goods markets (the labour market) variables are obtained and related to the literature on macroeconomic theory with endogenous unemployment and imperfect competition, empirical results and policy issues. Copyright Blackwell Publishing Ltd 2005.
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Bibliographic InfoArticle provided by Wiley Blackwell in its journal Metroeconomica.
Volume (Year): 56 (2005)
Issue (Month): 3 (07)
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Web page: http://www.blackwellpublishing.com/journal.asp?ref=0026-1386
Other versions of this item:
- Ziesemer,Thomas, 2002. "Monopolistic Competition, Search Unemployment, and Macroeconomics," Research Memorandum 021, Maastricht University, Maastricht Economic Research Institute on Innovation and Technology (MERIT).
- Ziesemer,Thomas, 2001. "Monopolistic Competition and Search Unemployment: A Pissarides-Dixit-Stiglitz model," Research Memorandum 006, Maastricht University, Maastricht Economic Research Institute on Innovation and Technology (MERIT).
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