On The Social Efficiency In Monopolistic Competitioin Models

Igor Pospelov () and Stanislav Radionov
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Igor Pospelov: National Research University Higher School of Economics

HSE Working papers from National Research University Higher School of Economics

Abstract: We consider standard monopolistic competition models with aggregate consumer's preferences de ned by two well-known classes of utility functions | the Kimball utility function and the variable elasticity of substitution utility function. It is known that market equilibruim is ecient only for the special case when utility function has a constant elasticity of substitution, but we nd that in both cases a special tax on rms' output may be introduced such that market equilibrium becomes ecient

Keywords: monopolistic competition; eciency. (search for similar items in EconPapers)
JEL-codes: D43 D61 (search for similar items in EconPapers)
Pages: 11 pages
Date: 2014
New Economics Papers: this item is included in nep-com, nep-ind and nep-upt
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Published in WP BRP Series: Economics / EC, December 2014, pages 1-11

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Journal Article: On the Social Efficiency in Monopolistic Competition Models (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:hig:wpaper:80/ec/2014

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