Imperfect competition à la Negishi also with fixed costs
The paper studies equilibria for economies with imperfect competition and non-convex technologies. Following Negishi firms maximise profits under downward-sloping perceived demand functions. Negishi's assumptions, in particular the assumption of a single monopolistic competitor in each market, are relaxed. Existence of equilibria is obtained, under otherwise standard assumptions, for production sets defined in each firm by the union of a convex technology and a technology subjected to fixed costs. In the light of a counterexample it is assumed that fixed factors are distinct from variable factors. Technically the proof rests on pricing rules.
|Date of creation:||07 Apr 2003|
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|Note:||Type of Document - pdf; prepared on Tex; pages: 30; figures: included. to appear in JME|
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- Bonnisseau, J.-M. & Cornet, B., 1986.
"Existence of equilibria when firms follow bounded losses pricing rules,"
CORE Discussion Papers
1986007, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Bonnisseau, Jean-Marc & Cornet, Bernard, 1988. "Existence of equilibria when firms follow bounded losses pricing rules," Journal of Mathematical Economics, Elsevier, vol. 17(2-3), pages 119-147, April.
- Blanchard, Olivier Jean & Kiyotaki, Nobuhiro, 1987. "Monopolistic Competition and the Effects of Aggregate Demand," American Economic Review, American Economic Association, vol. 77(4), pages 647-66, September.
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