Advances in Economics and Business Vol. 1(2), pp. 145 - 149
DOI: 10.13189/aeb.2013.010210
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Heterogeneous Consumers in the Monopolistically Competitive Setting


Alexander Osharin*
National Research University Higher School of Economics, Nizhny Novgorod, Russia

ABSTRACT

The paper investigates distributional effects and market structure in a one-sector model of monopolistic competition with heterogeneous consumers. By using the CES utility function depending on consumer’s personal income the paper shows how the equilibrium prices, firm size and number of firms depend upon income distribution and intensity of competition. The proposed model extends the traditional Dixit-Stiglitz approach and has a wider range of applications.

KEYWORDS
Monopolistic Competition, Heterogeneous Consumers, Income Distribution

Cite this paper
Alexander Osharin . "Heterogeneous Consumers in the Monopolistically Competitive Setting." Advances in Economics and Business 1.2 (2013) 145 - 149. doi: 10.13189/aeb.2013.010210.