IDEAS home Printed from https://ideas.repec.org/p/fip/feddgw/15.html
   My bibliography  Save this paper

Variety, globalization, and social efficiency

Author

Listed:
  • Cox, W. Michael
  • Ruffin, Roy J.

Abstract

This paper puts recent work on the benefits of variety into the context of a more complete quantitative analysis of the Dixit-Stiglitz-Krugman model of monopolistic competition. We show how the gains from globalization are reflected in the increase in variety and the exploitation of economies of scale, and that the social efficiency question is quantitatively insignificant. These results follow from examining a Bertrand-Nash equilibrium that allows for a finite number of varieties to affect the elasticity of demand facing each firm. We develop a precise expression for per capita real income with any number of sectors where globalization increases productivity through economies of scale.

Suggested Citation

  • Cox, W. Michael & Ruffin, Roy J., 2008. "Variety, globalization, and social efficiency," Globalization and Monetary Policy Institute Working Paper 15, Federal Reserve Bank of Dallas.
  • Handle: RePEc:fip:feddgw:15
    Note: Published as: Cox, W. Michael and Roy J. Ruffin (2010), "Variety, Globalization, and Social Efficiency," Southern Economic Journal 76 (4): 1064-1075.
    as

    Download full text from publisher

    File URL: http://dallasfed.org/assets/documents/institute/wpapers/2008/0015.pdf
    Download Restriction: no

    More about this item

    JEL classification:

    • D60 - Microeconomics - - Welfare Economics - - - General
    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:fip:feddgw:15. 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: (Amy Chapman). General contact details of provider: http://edirc.repec.org/data/frbdaus.html .

    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.

    We have no references for this item. You can help adding them by using 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.