EconPapers    
Economics at your fingertips  
 

Search in the product market and the real business cycle

Thomas Mathä () and Olivier Pierrard ()

Journal of Economic Dynamics and Control, 2011, vol. 35, issue 8, 1172-1191

Abstract: Empirical evidence suggests that most firms operate in imperfectly competitive markets. We develop a search-matching model between wholesalers and retailers. Firms face search costs and form long-term relationships. Price bargain results in both wholesaler and retailer mark ups, which depend on firms' relative bargaining power. We simulate the general equilibrium model and explore the role of product market search frictions for business cycles. We conclude from the simulation exercise that incorporating product market search structure and shocks improve the standard real business cycle model to reproduce US business cycle fluctuations.

Keywords: Business; cycle; Frictions; Search; Product; market; Price; bargain (search for similar items in EconPapers)
Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations View citations in EconPapers (4) Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0165188911000467
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Search in the product market and the real business cycle (2011) Downloads
Working Paper: Search in the Product Market and the Real Business Cycle (2009) Downloads
Working Paper: Search in the product market and the real business cycle (2009) Downloads
Working Paper: Search in the product market and the real business cycle (2008) Downloads
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:eee:dyncon:v:35:y:2011:i:8:p:1172-1191

Access Statistics for this article

Journal of Economic Dynamics and Control is currently edited by J. Bullard, C. Chiarella, H. Dawid, C. H. Hommes, P. Klein and C. Otrok

More articles in Journal of Economic Dynamics and Control from Elsevier
Series data maintained by Dana Niculescu ().

 
Page updated 2017-10-23
Handle: RePEc:eee:dyncon:v:35:y:2011:i:8:p:1172-1191