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On Equilibrium in Monopolistic Competition with Endogenous Labor

Author

Listed:
  • Alexey Kushnir
  • Alexander Tarasov
  • Robertas Zubrickas

Abstract

We consider a model of monopolistic competition with several heterogeneous sectors and endogenous labor supply. For low (high) values of the labor supply elasticity, we show that there is always a unique equilibrium. For medium values of the labor supply elasticity, the set of equilibria (if non-empty) can comprise of several equilibria, with the number of equilibria bounded by the number of sectors.

Suggested Citation

  • Alexey Kushnir & Alexander Tarasov & Robertas Zubrickas, 2020. "On Equilibrium in Monopolistic Competition with Endogenous Labor," CESifo Working Paper Series 8360, CESifo.
    • Handle: RePEc:ces:ceswps:_8360
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    labor elasticity; multiple equilibria; stability;
    All these keywords.

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets

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