Protection for Sale with Monopolistic Competition and Heterogeneous Firms

2007 ◽  
Author(s):  
Pedro Luís Bretan
Keyword(s):  
Monopolistic Competition ◽  
Heterogeneous Firms ◽  
Protection For Sale

Multinationals and environmental regulation: are foreign firms harmful?

2012 ◽  
Vol 17 (2) ◽  
pp. 163-186 ◽  
Author(s):  
Evangelina Dardati ◽  
Meryem Saygili
Keyword(s):  
Environmental Regulation ◽  
Multinational Firms ◽  
Monopolistic Competition ◽  
Environmental Regulations ◽  
Heterogeneous Firms ◽  
Foreign Firms ◽  
Domestic Firms ◽  
Level Data ◽  
Multinational Production ◽  
Plant Level

AbstractThe rise of globalization has directed the attention of economists to the effect of trade and multinational production on the environment. We explore whether multinational firms, frequently the target of environmentalists, are harmful for a host country's environment. We introduce environmental regulation in a two-country model of heterogeneous firms with monopolistic competition. Using plant-level data from Chile, we test the model implications. We find that foreign firms are cleaner than domestic plants even after controlling for productivity that is likely to be negatively correlated with emissions. We also show that increasing the stringency of environmental regulations in a previously unregulated market affects the domestic firms more than the multinationals.

Strategic CSR, Heterogeneous Firms and Credit Constraints

2016 ◽  
Vol 16 (4) ◽  
Author(s):  
Luisa Giallonardo ◽  
Marcella Mulino
Keyword(s):  
Monopolistic Competition ◽  
Credit Constraints ◽  
Heterogeneous Firms ◽  
Optimal Level ◽  
External Financing ◽  
Ethical Awareness ◽  
Policy Interventions ◽  
Quality Product ◽  
Strategic Csr

Abstract: We set out a model of strategic CSR with consumers’ demand for CSR products, where ethical features improve the “quality” of goods through a complementarity between production and CSR provision. Our model builds on the literature based on heterogeneous firms in monopolistic competition with quality product differentiation. By letting the optimal level of ethical standards to be endogenously determined by each profit-maximizing firm, we analyse the link between heterogeneity in productivity and CSR intensity. The analytical results are confirmed by a numerical analysis. We then consider the need for external financing, finding that credit constraints may lead active firms to reduce the optimal CSR level whereas the reputational effect of CSR firms may help in dampening the reduction in firms’ optimal CSR level. Finally, we find that policy interventions may lead to a higher level of the optimal CSR, when addressed to change firms’ incentives and consumers’ ethical awareness.

scholarly journals Sales and Markup Dispersion: Theory and Empirics

Econometrica ◽  
2021 ◽  
Vol 89 (4) ◽  
pp. 1753-1788 ◽  
Author(s):  
Monika Mrázová ◽  
J. Peter Neary ◽  
Mathieu Parenti
Keyword(s):  
Demand Function ◽  
Structural Model ◽  
Monopolistic Competition ◽  
Heterogeneous Firms ◽  
Dispersion Theory ◽  
Firm Level ◽  
Level Data ◽  
Indian Firm ◽  
Necessary And Sufficient ◽  
The Relationship

We characterize the relationship between the distributions of two variables linked by a structural model. We then show that, in models of heterogeneous firms in monopolistic competition, this relationship implies a new demand function that we call “CREMR” (Constant Revenue Elasticity of Marginal Revenue). This demand function is the only one that is consistent with productivity and sales distributions having the same form (whether Pareto, lognormal, or Fréchet) in the cross section, and it is necessary and sufficient for Gibrat's Law to hold over time. Among the applications we consider, we use our methodology to characterize misallocation across firms; we derive the distribution of markups implied by any assumptions on demand and productivity; and we show empirically that CREMR‐based markup distributions provide an excellent parsimonious fit to Indian firm‐level data, which in turn allows us to calculate the proportion of firms that are of suboptimal size in the market equilibrium.

scholarly journals Computable General Equilibrium Models for Policy Evaluation and Economic Consequence Analysis

2018 ◽  
Author(s):  
Ian Sue Wing ◽  
Edward J. Balistreri
Keyword(s):  
General Equilibrium ◽  
Computable General Equilibrium ◽  
Monopolistic Competition ◽  
Heterogeneous Firms ◽  
Greenhouse Gas Mitigation ◽  
Computable General Equilibrium Models ◽  
Analysis And Evaluation ◽  
Multiple Markets ◽  
Cge Modeling ◽  
Shed Light

This chapter reviews recent applications of computable general equilibrium (CGE) modeling in the analysis and evaluation of policies that affect interactions among multiple markets. At the core of this research is a particular approach to the data and structural representations of the economy, elaborated through the device of a canonical static multiregional model. This template is adapted and extended to shed light on the structural and methodological foundations of simulating dynamic economies, incorporating “bottom-up” representations of discrete production activities, and modeling contemporary theories of international trade with monopolistic competition and heterogeneous firms. These techniques are motivated by policy applications including trade liberalization, development, energy policy and greenhouse gas mitigation, the impacts of climate change and natural disasters, and economic integration and liberalization of trade in services.

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