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Endogenous Market Structures and Macroeconomic Theory


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  • F. Etro


This article applies the emerging theory of endogenous market structures to macroeconomic issues through a few simple models. First, we study a model of Schumpeterian growth where strategic interactions and endogenous entry determine the equilibrium behaviour of the firms investing in R&D. Second, we provide a new framework to study business cycles with imperfect competition in quantities à la Cournot and endogenous entry, and we show how a temporary shock promotes entry, reduces the mark ups and magnifies the impact on consumption. Third, we revisit the new trade theory adopting both strategic interactions and endogenous entry and revisiting some traditional results on the impact of opening to trade, the optimal tariff and the optimal export subsidy.

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Bibliographic Info

Article provided by Katholieke Universiteit Leuven, Faculteit Economie en Bedrijfswetenschappen in its journal Review of Business and Economics.

Volume (Year): LII (2007)
Issue (Month): 4 ()
Pages: 517-540

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Handle: RePEc:ete:revbec:20070401

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Cited by:
  1. Federico Etro, 2010. "Endogenous Market Structures and Contract Theory," Working Papers, University of Milano-Bicocca, Department of Economics 181, University of Milano-Bicocca, Department of Economics, revised Mar 2010.
  2. Federico Etro & Andrea Colciago, 2007. "Endogenous Market Structure and the Business Cycle," Working Papers, University of Milano-Bicocca, Department of Economics 126, University of Milano-Bicocca, Department of Economics, revised Nov 2007.
  3. Federico Etro, 2010. "Endogenous market structures and antitrust policy," International Review of Economics, Springer, Springer, vol. 57(1), pages 9-45, March.
  4. Maria José Gil-Moltó & Dimitrios Varvarigos, 2012. "Industry Dynamics and Indeterminacy in an OLG Economy with Endogenous Occupational Choice," Discussion Papers in Economics 12/09, Department of Economics, University of Leicester, revised Sep 2012.


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