Subject: Economics and business
Subject: Social and economic geography
Year: 2011
Type: Article
Type: PeerReviewed
Title: Monopolistic competition: Critical evaluation the theory of monopolistic competition with specific reference to the seminal 1977 paper by Dixit and Stiglitz
Author: Josheski, Dushko
Author: Koteski, Cane
Author: Lazarov, Darko
Abstract: This paper revisits the D-S (Dixit-Stiglitz) model. It’s a simple general monopolistic model with n monopolistic goods, and a numeraire good Labour ( ); aggregation for all goods in the economy. We have considered in our paper constant elasticity of substitution case(CES).On the supply side, the assumption is that the labour is perfectly mobile factor of production across the sectors, so as a result in our model there is single wage rate which we denote as in the other sectors than monopolistic there is constant returns to scale and we can specify the production function: The Dixit-Stiglitz model of monopolistic competition works only when is large; from the functions of the productions best when one applies linear production function. Under increasing returns to scale monopolistic competition will lead to a greater degree of product differentiation than it is socially optimal.
Publisher: Munich University Library
Relation: https://eprints.ugd.edu.mk/1536/
Identifier: oai:eprints.ugd.edu.mk:1536
Identifier: https://eprints.ugd.edu.mk/1536/1/Copy%20of%20MPRA_paper_33802.rtf.pdfIdentifier: Josheski, Dushko and Koteski, Cane and Lazarov, Darko (2011) Monopolistic competition: Critical evaluation the theory of monopolistic competition with specific reference to the seminal 1977 paper by Dixit and Stiglitz. Munich Personal RePEc Archive. p. 19.
Identifier: 33802
