Competition, "welfare" and macroeconomics- a classical/Sraffian perspe ctive
An essential point to arise out of macroeconomic literature of the last twenty years is that imperfect competition in product markets allows scope for aggregate demand to affect the level of output and employment; and to have positive impacts on "welfare". The present paper considers the connection between "imperfect competition" and macroeconomic outcomes from a Sraffian perspective. In this case, the appropriate categorisation is one of restricted versus unrestricted competition: essentially the ability of intersectoral capital mobility to enforce a uniform rate of profit. The paper also considers the significance of product differentiation, which is generally assumed to be the defining characteristic of imperfectly competitive markets. A Sraffian approach makes clear the limited significance of the concept product differentiation in a multi-commodity framework particularly in drawing hard and fast implications about "welfare". The investigation of connections between restricted competition and macro outcomes therefore turns largely on the significance of restrictions on mobility for output and employment multipliers.
|Date of creation:||Jun 2009|
|Contact details of provider:|| Postal: Sydney, NSW 2006|
Phone: 61 +2 9351 5055
Fax: 61 +2 9351 4341
Web page: http://sydney.edu.au/arts/economics
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Mankiw, N Gregory, 1990.
"A Quick Refresher Course in Macroeconomics,"
Journal of Economic Literature,
American Economic Association, vol. 28(4), pages 1645-1660, December.
- N. Gregory Mankiw, 1990. "A Quick Refresher Course in Macroeconomics," NBER Working Papers 3256, National Bureau of Economic Research, Inc.
- Blanchard, Olivier Jean & Kiyotaki, Nobuhiro, 1987. "Monopolistic Competition and the Effects of Aggregate Demand," American Economic Review, American Economic Association, vol. 77(4), pages 647-666, September.
- Kurz,Heinz D. & Salvadori,Neri, 1997. "Theory of Production," Cambridge Books, Cambridge University Press, number 9780521588676, November.
- Kurz,Heinz D. & Salvadori,Neri, 1995. "Theory of Production," Cambridge Books, Cambridge University Press, number 9780521443258, Diciembre.
- Oliver D. Hart, 1985. "Monopolistic Competition in the Spirit of Chamberlin: A General Model," Review of Economic Studies, Oxford University Press, vol. 52(4), pages 529-546.
- Bidard, Christian, 1998. "Laws on Long-Term Prices," The Manchester School of Economic & Social Studies, University of Manchester, vol. 66(4), pages 453-465, September.
- Mankiw, N. Gregory, 1988. "Imperfect competition and the Keynesian cross," Economics Letters, Elsevier, vol. 26(1), pages 7-13.
- N. Gregory Mankiw, 1987. "Imperfect Competition and the Keynesian Cross," NBER Working Papers 2386, National Bureau of Economic Research, Inc.
- Leonardo Vera, 2006. "Representative agent meets class structure: imperfect competition and the balanced-budget multiplier," Cambridge Journal of Economics, Oxford University Press, vol. 30(5), pages 783-796, September. Full references (including those not matched with items on IDEAS)
When requesting a correction, please mention this item's handle: RePEc:syd:wpaper:2123/7066. 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: (Vanessa Holcombe)
If references are entirely missing, you can add them using this form.