Advanced Search
MyIDEAS: Login

Monopolistic Competition in General Equilibrium: Beyond the CES

Contents:

Author Info

  • Evgeny Zhelobodko

    ()
    (Novosibirsk State University (Russia))

  • Sergey Kokovin

    ()
    (Novosibirsk State University and Sobolev Institute of Mathematics (Russia))

  • Mathieu Parenti

    ()
    (Université de Paris 1 and PSE (France))

  • Jacques-François Thisse

    ()
    (CORE-UCLouvain (Belgium), CREA, Université du Luxembourg, and CEPR.)

Abstract

We propose a general model of monopolistic competition and derive a complete characterization of the market equilibrium using the concept of Relative Love for Variety. When the RLV increases with individual consumption, the market generates pro-competitive effects. When it decreases, the market mimics anti-competitive behavior. The CES is a borderline case. We extend our setting to heterogeneous firms and show that the cutoff cost decreases (increases) when the RLV increases (decreases). Last, we study how combining vertical, horizontal and cost heterogeneity affects our results.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://wwwfr.uni.lu/content/download/35482/427118/file/2011-03%20-%20Monopolistic%20Competition%20in%20General%20Equilibrium.pdf
Download Restriction: no

Bibliographic Info

Paper provided by Center for Research in Economic Analysis, University of Luxembourg in its series CREA Discussion Paper Series with number 11-03.

as in new window
Length:
Date of creation: 2011
Date of revision:
Handle: RePEc:luc:wpaper:11-03

Contact details of provider:
Postal: 162a avenue de la Faïencerie, L-1511 Luxembourg
Phone: (+352) 46 66 44
Fax: (+352) 46 66 44 ext 633
Email:
Web page: http://wwwen.uni.lu/research/fdef/crea
More information through EDIRC

Related research

Keywords: monopolistic competition; additive preferences; love for variety; heterogeneous firms;

Other versions of this item:

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

No references listed on IDEAS
You can help add them by filling out this form.

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Yoshitsugu Kanemoto, 2012. "Cost-Benefit Analysis in Monopolistic Competition Models of Urban Agglomeration," GRIPS Discussion Papers 12-04, National Graduate Institute for Policy Studies.
  2. Lu, Yi & Tao, Zhigang & Yu, Linhui, 2011. "Agglomeration and Markup," MPRA Paper 38974, University Library of Munich, Germany, revised May 2012.
  3. Zhelobodko, E. & Sidorov, A. & Thisse, J.-F., 2013. "Monopolistic Competition vs Oligopoly in the "Large Economy": How Much Is Difference?," Journal of the New Economic Association, New Economic Association, vol. 19(3), pages 10-26.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:luc:wpaper:11-03. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Elisa Ferreira).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.