Reference : On the effects of income heterogeneity in monopolistically competitive markets” |
Scientific congresses, symposiums and conference proceedings : Unpublished conference | |||
Business & economic sciences : International economics | |||
http://hdl.handle.net/10993/48994 | |||
On the effects of income heterogeneity in monopolistically competitive markets” | |
English | |
Picard, Pierre M ![]() | |
Kichko, Sergey [Higher School of Economics] | |
Aug-2021 | |
No | |
International | |
European Economic Association | |
from 23 to 27 August 2021 | |
European Economic Association | |
Copenhagen | |
[en] Monopolistic competition ; nonhomothetic preferences ; income inequality, | |
[en] This paper studies the e¤ects of income heterogeneity on monopolistically competitive
product markets and welfare in the context of non-homothetic preferences. When richer individuals expenditures are less sensitive to price change compared to poorer ones , a mean-preserving contraction of income distribution entices rms to charge higher prices, new rms enter and broaden product diversity. General equilibrium e¤ects have a negative impact on poorer individuals and, in speci c circumstances, on whole population. In open economies, lower income inequality in a country creates a price divergence between countries and decreases trade volumes and values. Those general equilibrium e¤ects are quantitatively non negligible. | |
http://hdl.handle.net/10993/48994 |
There is no file associated with this reference.
All documents in ORBilu are protected by a user license.