Search frictions, market power, and long-run growth

• 成果类型: Article
• 署名作者: Tse, CY
• 署名单位: University of Hong Kong
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/S0022-0531(03)00260-6
• 发表日期: 2004
• 页码: 323-346
• 关键词: search; market structure; long-run growth

摘要

This paper embeds product market search in an Ak growth model to study the effects of search frictions on market structure, capital accumulation, and long-run growth. The basic hypothesis is that search frictions, in giving rise to market power, result in higher prices and lower output levels. The failing demand for capital stemming from firms cutting back output then lowers the interest rate, dampening capital accumulation and slowing down growth. A decline in search frictions sets the process in reverse, eventually speeding up growth through the change in market structure. In the meantime, the stock market values of firms could fall. (C) 2003 Elsevier Inc. All rights reserved.