The purpose of this article is twofold. First, it deals with the question of technology choice in a framework where agents are 'small'. It shows that firms generically choose the same technology although different technologies are available. Our simple static model yields a non-monotonous...

We introduce technology choice into a model of monopolistic competition and analyze the structural effects of changes in market size. A larger market leads to the adoption of a large-scale technology. If a technology switch occurs, the number of firms decreases, and a rationalizing effect...