Dmitry, Pokrovsky; Kristian, Behrens; Evgeny, Zhelobodko - EERC Research Network, Russia and CIS - 2014
We develop a monopolistic competition model with two sectors and heterogeneousagents who self-select into entrepreneurship, depending on entrepreneurial ability. Theeffect of market size on the equilibrium share of entrepreneurs crucially hinges on propertiesof the lower-tier utility function...