Monopolistic competition in general equilibrium: Beyond the CES

Evgeny Zhelobodko, Sergey Kokovin, Mathieu Parenti () and Jacques Thisse

Working Papers from HAL

Abstract: We propose a general model of monopolistic competition and derive a complete characterization of the market equilibrium using the concept of Relative Love for Variety. When the RLV increases with individual consumption, the market generates pro-competitive effects. When it decreases, the market mimics anti-competitive behavior. The CES is a borderline case. We extend our setting to heterogeneous firms and show that the cutoff cost decreases (increases) when the RLV increases (decreases). Last, we study how combining vertical, horizontal and cost heterogeneity affects our results.

Keywords: monopolistic competition; additive preferences; love for variety; heterogeneous firms; concurrence monopolistique; préférences additives; préférence pour la variété; firmes hétérogènes (search for similar items in EconPapers)
Date: 2011-02
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-00566431v1
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

Downloads: (external link)
https://shs.hal.science/halshs-00566431v1/document (application/pdf)

Related works:
Working Paper: Monopolistic competition in general equilibrium: beyond the CES (2011)
Working Paper: Monopolistic competition in general equilibrium: Beyond the CES (2011)
Working Paper: Monopolistic Competition in General Equilibrium: Beyond the CES (2011)
Working Paper: Monopolistic Competition in General Equilibrium: Beyond the CES (2011)
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:hal:wpaper:halshs-00566431

Access Statistics for this paper

More papers in Working Papers from HAL
Bibliographic data for series maintained by CCSD ().