Monopolistic competition, transaction costs and multiple equilibria

Monopolistic competition, transaction costs and multiple equilibria

This paper analyzes the role of transactions costs in a macroeconomic model of monopolistic competition. If there is sufficient increasing returns to scale in transaction technology, the economy exhibits multiple equilibria even if the production technology is constant or decreasing returns to scale...

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Veröffentlicht in:Economics letters 2005-04, Vol.87 (1), p.21-26
Hauptverfasser: Julien, Ludovic A., Sanz, Nicolas
Format: Artikel
Sprache:eng
Schlagworte:
Economic equilibrium
Economic theory
Imperfect competition
Increasing returns
Market theory
Mathematical methods
Monopolies
Monopolistic competition
Multiple equilibria
Trading costs
Transaction costs
Unemployment
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Beschreibung
Zusammenfassung:This paper analyzes the role of transactions costs in a macroeconomic model of monopolistic competition. If there is sufficient increasing returns to scale in transaction technology, the economy exhibits multiple equilibria even if the production technology is constant or decreasing returns to scale.
ISSN:0165-1765
1873-7374
DOI:10.1016/j.econlet.2004.08.010