We study monopolistic competition under indirect additivity of preferences. This is dual to the Dixit-Stiglitz model, where direct additivity is assumed, with the CES case as the only common ground. Other examples include (perceived) demand functions that are exponential or linear. Our...

This paper models a generalized form of monopolistic competition such that consumers are differentiated horizontally by taste while firms are differentiated vertically by quality location. Consumers have quadratic transportation costs of disutility from consuming a non-ideal brand, and firms are...

We study monopolistic competition with asymmetric preferences over a variety of goods provided by heterogeneous firms and show how to compute equilibria (which approximate Cournot and Bertrand equilibria when market shares are negligible) through the Morishima measures of substitution. Further...

We develop a product-differentiated model where the product space is a network defined as a set of varieties (nodes) linked by their degrees of substitutability (edges). We also locate consumers into this network, so that the location of each consumer (node) corresponds to her "ideal" variety....

The Great Recession, which was preceded by the financial crisis, resulted in higher unemployment and inequality. We propose a simple model where firms producing varieties face labor-market frictions and credit constraints. In the model, tighter credit leads to lower output, lower number of...

The Great Recession, which was preceded by the financial crisis, resulted in higher unemployment and inequality. We propose a simple model where firms producing varieties face labor-market frictions and credit constraints. In the model, tighter credit leads to lower output, lower number of...

We develop a monopolistic-competition model of closed two-sector one-factor economy, where agents are (continuously) heterogeneous in their entrepreneurship abilities and choose between being employees or entrepreneurs. The sufficient conditions in terms of variable elasticity of substitution...

It is often argued that price indexes do not fully capture the quality improvements of new goods in the market. Because of this shortcoming, price indexes are perceived to overestimate the actual price increases that occur. In this paper, I argue that the quality bias in price indexes is just as...

We propose a general model of monopolistic competition which encompasses existing models while being flexible enough to take into account new demand and competition features. Even though preferences need not be additive and/or homothetic, the market outcome is still driven by the sole variable...

The "spokes model" takes the name from its graphical visualisation, that resembles the spokes of a bike's wheel. It describes a market as a collection of spokes, joining at a common centre, where consumers are located. Firms may be situated at the extreme of these spokes, at the interior of the...