The Open Monopolistic Competition Models: Market Equilibrium and Social Optimality Full article
| Journal |
Mathematics
, E-ISSN: 2227-7390 |
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| Output data | Year: 2023, Volume: 11, Number: 19, Article number : 4172, Pages count : 13 DOI: 10.3390/math11194172 | ||
| Tags | monopolistic competition; international trade; market equilibrium; social optimality | ||
| Authors |
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| Affiliations |
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Funding (1)
| 1 | Sobolev Institute of Mathematics | FWNF-2022-0019 |
Abstract:
We study the monopolistic competition model of Dixit–Stiglitz–Krugman with additive separable utility and transport costs of “iceberg types”. The production costs are not necessary linear. We study two concepts: market equilibrium and social optimality. There are well-known facts in the closed economy under monopolistic competition: (1) “in market equilibrium, the elasticity of revenue equals the elasticity of total costs” and (2) “in social optimality, the elasticity of utility equals the elasticity of total costs”. Moreover, earlier Prof. Sergey Kokovin (HSE University, Russia) generated the idea that (3) “the search for equilibrium is equivalent to the problem of optimization, but revenue, not utility”. For the case of several countries, it turns out that facts (1) and (2) and prediction (3) remain mostly true.
Cite:
Bykadorov I.
The Open Monopolistic Competition Models: Market Equilibrium and Social Optimality
Mathematics. 2023. V.11. N19. 4172 :1-13. DOI: 10.3390/math11194172 WOS Scopus РИНЦ OpenAlex
The Open Monopolistic Competition Models: Market Equilibrium and Social Optimality
Mathematics. 2023. V.11. N19. 4172 :1-13. DOI: 10.3390/math11194172 WOS Scopus РИНЦ OpenAlex
Dates:
| Submitted: | Aug 23, 2023 |
| Accepted: | Oct 3, 2023 |
| Published print: | Oct 5, 2023 |
| Published online: | Oct 5, 2023 |
Identifiers:
| Web of science: | WOS:001145785500001 |
| Scopus: | 2-s2.0-85176410893 |
| Elibrary: | 63207021 |
| OpenAlex: | W4387377707 |
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