Monopolistic Competition and the Effects of Aggregate Demand

Olivier Blanchard and Nobuhiro Kiyotaki

American Economic Review, 1987, vol. 77, issue 4, 647-66

Abstract: How important is monopolistic competition to an understanding of the effects of aggregate demand on output? The authors ask this question at three levels. Can monopolistic competition, by itself, explain why aggregate demand affects output? Can it, together with other imperfections, generate effects of aggregate demand in a way that perfect competition cannot? If so, can it give an accurate account of the res ponse of the economy to aggregate demand movements? The answers are no, yes, and yes. Copyright 1987 by American Economic Association.

Date: 1987
References: Add references at CitEc
Citations: View citations in EconPapers (907)

Downloads: (external link)
http://links.jstor.org/sici?sici=0002-8282%2819870 ... O%3B2-X&origin=repec full text (application/pdf)
Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:aea:aecrev:v:77:y:1987:i:4:p:647-66

Ordering information: This journal article can be ordered from
https://www.aeaweb.org/journals/subscriptions

Access Statistics for this article

American Economic Review is currently edited by Esther Duflo

More articles in American Economic Review from American Economic Association Contact information at EDIRC.
Bibliographic data for series maintained by Michael P. Albert ().