Endogenous Market Structures and the Macroeconomy (eBook)

Preface 6
Contents 15
1. Neoclassical Macroeconomics 19
1.1 The Microfoundation of Macroeconomics 20
1.2 Growth 34
1.3 International Finance and Trade 44
1.4 Business Cycles 55
1.5 Conclusions 68
2. The EMSs Approach to Macroeconomics 69
2.1 EMSs in Partial Equilibrium 73
2.2 Microfounded EMSs 78
2.3 EMSs with Isoelastic Sub-utility 83
2.4 EMSs in a Two Period Economy 93
2.5 EMSs in General Equilibrium 96
2.6 EMSs in an In.nite Periods General Equilibrium Economy 99
2.7 Business Cycle 106
2.8 Trade 108
2.9 Growth 109
2.10 Conclusions 111
3. Endogenous Market Structures and Business Cycles 113
3.1 Empirical Evidence on EMSs over the Business Cycle 116
3.2 A Model of the Business Cycle with EMSs 123
3.3 Steady State EMSs 132
3.4 Impulse Response Functions and Second Moments 138
3.5 EMSs and Accumulation of Physical Capital 148
3.6 Fiscal Policy 151
3.7 Monetary Policy 155
3.8 Labor and Credit Market Imperfections 159
3.9 Conclusions 162
4. Endogenous Market Structures and International Trade and Finance 163
4.1 Empirical Evidence on EMSs and Market Size E¤ects 167
4.2 A Model of Trade with EMSs 174
4.3 The Ghironi-Melitz Model 181
4.4 Trade Policy and Import Tari¤s 187
4.5 Strategic Export Promotion 190
4.6 Trade Policy and Export Subsidies 195
4.7 Protectionism, Lobbying and Trade Wars 201
4.8 Exchange Rate Policy 205
4.9 R& D Policy and IPRs Protection
4.10 Conclusions 213
5. Endogenous Market Structures and Growth 214
5.1 Empirical Evidence on EMSs and Innovation by Leaders 217
5.2 A Model of Endogenous Growth 229
5.3 A Model of Schumpeterian Growth 236
5.4 EMSs with Growth Leaders 243
5.5 Fiscal Policy 248
5.6 Monetary Policy 253
5.7 Growth and International Trade and Finance 257
5.8 Conclusions 263
6. Economic Principles and Policy for the New Economy 264
6.1 Short-run EMSs and the Competition Effect 265
6.2 Steady-state EMSs and Entry 275
6.3 Gains from Trade and the E¤ects of Globalization 284
6.4 Growth Driven by Leaders 288
6.5 Dynamic Ine¢ ciency 294
6.6 Fiscal Policy 296
6.7 Monetary Policy 302
6.8 Trade Policy 307
6.9 Exchange Rate Policy 311
6.10 Innovation and Competition Policy 316
6.11 Conclusions 325
7. Epilogue 326
8. References 330
Index 356