We estimate the macroeconomic benefits and international spillovers of an increase in competition using a general …-equilibrium simulation model with nominal rigidities and monopolistic competition in product and labor markets. We draw three conclusions … after calibrating the model to the euro area against the rest of the industrial world. First, greater competition produces …

(Smith 1962) and recent theoretical results (Dufwenberg et al. 2008) suggest that competition forces people to behave as if …

-sharing, screening opportunities, and competition are important driving forces behind these new forms of work organization. We document … competition substantially fosters the trust strategy, reduces market segmentation, and leads to large welfare gains for both …

financial system in which there is intense competition among banks for private households' funds. Following earlier work by … contracts is restrained by households' financial market access. However, we also assume spatial monopolistic competition among … monopoly rents also entails a positive effect; however, this beneficial effect is only relevant if competition among banks does …

competition on this choice. We find that competing banks use collateral less often than a monopolistic bank because competition … will intensify if both banks collateralize. Moreover, bank competition is welfare improving if collateralization is rather … are better able to evaluate a project's risk than entrepreneurs. We study the bank's choice between screening and …

such a model. Third, we estimate the model with Bayesian methods to fit Mexico's business cycle and financial crisis …

and economic activity have declined in recent years. These results have implications for investors, bank regulators, and …