Monopolistic competition model: The impact of technological innovation on equilibrium and social optimality

I. V. Antoshchenkova, I. A. Bykadorov

Research output: Contribution to journalArticlepeer-review

10 Citations (Scopus)

Abstract

This paper considers a monopolistic competition model with the endogenous choice of technology in the closed economy case. Our aim is to obtain the comparative statics of the equilibrium and socially optimal solutions with respect to the technological innovation parameter that affects costs. The key findings are the following: consumption and investments in productivity both increase with the growth of technological innovation; the behavior of the equilibrium variables depends on the elasticity of demand only; the behavior of the socially optimal variables depends on the elasticity of utility only; finally, the behavior of the equilibrium and socially optimal variables does not depend on the properties of the costs as a function of investments in R&D.

Original languageEnglish
Pages (from-to)537-556
Number of pages20
JournalAutomation and Remote Control
Volume78
Issue number3
DOIs
Publication statusPublished - 1 Mar 2017

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