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Markups and Entry in a DSGE Model

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  • Cavallari, Lilia

Abstract

This paper provides a DSGE model with firm entry. Simulations show that the model matches the synchronization of markups and entry observed in the data while at the same time reproducing empirically plausible moments for key macroeconomic variables. Sticky prices are essential for these results.

Suggested Citation

  • Cavallari, Lilia, 2012. "Markups and Entry in a DSGE Model," MPRA Paper 41816, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:41816
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    endogenous entry; firm dynamics; monopolistic competition; market power; markups;
    All these keywords.

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • E37 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Forecasting and Simulation: Models and Applications

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