A Theory of Monopolistic Competition with Horizontally Heterogeneous Consumers

• 成果类型: Article
• 署名作者: Kokovin, Sergey; Ozhegova, Alina; Sharapudinov, Shamil; Tarasov, Alexander; Ushchev, Philip
• 署名单位: HSE University (National Research University Higher School of Economics); Norwegian School of Economics (NHH); Pennsylvania Commonwealth System of Higher Education (PCSHE); Pennsylvania State University; HSE University (National Research University Higher School of Economics); Universite Libre de Bruxelles
• 刊物名称: AMERICAN ECONOMIC JOURNAL-MICROECONOMICS
• ISSN/ISSBN: 1945-7669
• DOI: 10.1257/mic.20200453
• 发表日期: 2024
• 关键词: plant size; TRADE; prices; location; QUALITY; markups; variety; margins; FIRMS

摘要

Our novel approach to modeling monopolistic competition with heterogeneous firms and consumers involves spatial product differentiation, in either a geographical space or a space of characteristics. In addition to price, each firm chooses location in space. We formulate conditions for positive sorting-more-productive firms serve larger market segments and face tougher competition-and for existence and uniqueness of equilibrium. To quantify the role of sorting, we calibrate the model using haircut market data and perform counterfactual analysis. Inequality in gains among consumers caused by positive market shocks can be substantial: gains for consumers at more-populated locations are three to four times higher.