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Existence of a Short-Run Equilibrium of the Dixit-Stiglitz-Krugman Model

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  • Minoru Tabata
  • Nobuoki Eshima

Abstract

Each short-run equilibrium of the Dixit-Stiglitz-Krugman model is defined as a solution to the wage equation when the distributions of workers and farmers are given functions. We extend the discrete nonlinear operator contained in the wage equation as a set-valued operator. Applying the Kakutani fixed-point theorem to the set-valued operator, under the most general assumptions, we prove that the model has a short-run equilibrium.

Suggested Citation

  • Minoru Tabata & Nobuoki Eshima, 2018. "Existence of a Short-Run Equilibrium of the Dixit-Stiglitz-Krugman Model," Discrete Dynamics in Nature and Society, Hindawi, vol. 2018, pages 1-8, June.
    • Handle: RePEc:hin:jnddns:2193070
    DOI: 10.1155/2018/2193070
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    Cited by:

    1. Ma, Wei & Naraidoo, Ruthira & Perugini, Francesco, 2023. "Computation of spatial equilibria in the Ottaviano–Tabuchi–Thisse model," Economics Letters, Elsevier, vol. 223(C).

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