Autor(es):
Costa, Luís F. 
; Dixon, Huw D.
Data: 2005
Identificador Persistente: http://hdl.handle.net/10400.5/2684
Origem: Repositório da UTL
Assunto(s): Entry; Hysteresis; Mark-up
Detalhes do Documento
A simple business-cycle model with schumpeterian features
Descrição
We develop a dynamic general equilibrium model of imperfect competition where a sunk cost of creating a new product regulates the type of entry that dominates in the economy: new products or more competition in existing industries. Considering the process of product innovation is irreversible, introduces hysteresis in the business cycle. Expansionary shocks may lead the economy to a new 'prosperity plateau,' but contractionary shocks only affect the market power of mature industries.
We develop a dynamic general equilibrium model of imperfect competition where a sunk cost of creating a new product regulates the type of entry that dominates in the economy: new products or more competition in existing industries. Considering the process of product innovation is irreversible, introduces hysteresis in the business cycle. Expansionary shocks may lead the economy to a new 'prosperity plateau,' but contractionary shocks only affect the market power of mature industries.
Tipo de Documento
Outro
Idioma Inglês
Idioma Inglês
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